tax evasion

[Catcompanion]

If I know someone who is taking deductions that are not allowed and therefore committing tax fraud, should I report them? I asked in another forum and was directed here. Is this a moral issue? Is it a civic duty? What to do?

 

[Just_Lurking]

How do you have access to this other person’s tax return to see what deductions he (or she) is claiming?

 

[Catholic90]

How do you KNOW this person is taking too many deductions? What PROOF do you have?

 

[TheTrueCentrist]

Is tax evasion a problem if tax dollars go to abortion?

 

[Catcompanion]

This is a matter of property settlement in a divorce that took place almost 30 years ago. The party in question has stated that they consider it to be alimony and will reflect this on their tax return. They stated this (in writing)when it first started, and they have restated this only last month( in e-mail). This has been going on for some 18 years. I need to know if I report it, am I committing some kind of sin?

 

[Just_Lurking]

The IRS uses social security numbers to track and reconcile alimony paid versus alimony received. If there is some discrepancy between the two the IRS computers should automatically catch it.

Is there some reason you don’t think the IRS is up to the task of reconciling alimony?

 

[puzzleannie]

This is a matter of property settlement in a divorce that took place almost 30 years ago. The party in question has stated that they consider it to be alimony and will reflect this on their tax return. They stated this (in writing)when it first started, and they have restated this only last month( in e-mail). This has been going on for some 18 years. I need to know if I report it, am I committing some kind of sin?

the party needs to go to their own tax advisor. If you are not a professional with expertise in this area, why is it your concern, and why do you have knowledge of something as confidential as this person’s finances to begin with? Are you contemplating doing this with a motive of getting the person in trouble? What kind of proof do you have? just boasting about getting away with something is not proof. You could report it, and such reports can be made anonymously, but I don’t see that you have a moral duty, nor that it would be morally wrong to do so unless your motive is suspect.

On the other hand if you are an employee, say, of a company engaged in tax fraud that you come to know if in the course of your duties, yes it becomes your duty to report it and to refuse to cooperate in the illegal activity.

 

[estesbob]

This is a matter of property settlement in a divorce that took place almost 30 years ago. The party in question has stated that they consider it to be alimony and will reflect this on their tax return. They stated this (in writing)when it first started, and they have restated this only last month( in e-mail). This has been going on for some 18 years. I need to know if I report it, am I committing some kind of sin?

As a CPA who has done thousands and thousands of tax returns I can’t tell from your post whether there is anything the report are not. I would recommend your friend go see a tax professional. Claiming something is alimony is going to be a problem as it is deductible for the one paying and taxable for the one receiving. You are required to provide a Social Security number of the one either giving you or the one you are paying to the alimony. If the amounts don’t match there are problems.