A telephone poll conducted by the Internal Revenue Service Oversight Board, randomly selected 1,500 Americans and asked them the question is it okay to cheat on your taxes? Of the 1,500 people in the poll 87 percent stated that is was never okay to cheat, while 11 percent of Americans stated that it is okay to cheat “a little here or there” or “as much as possible.” Ninety-five percent of those polled stated that personal integrity is the main influence in being honest on their taxes. By contrast 63 percent stated that they were honest on their returns due to a fear of an audit, while 41 percent stated they were honest because their neighbors are.
The United States Tax System requires people to report their income. What some people don’t realize is those statements that you receive at tax time are reported to the Internal Revenue Service as well. This makes cheating on your taxes very hard to do. If you do not report all of your income to the IRS, they will send you a nice love letter stating that they have information from sources that you did not report on your return.
The IRS’s system of identifying under reporters of income has become rather sophisticated over the years. If you under report your income, within a year from filing, the IRS will inform you that they have received information that you did not report to them. The IRS system isn’t full proof, in fact it is wrong more often than not, however the system for the most part works.
According to IRS statistics, the Service audits about 1 percent of all returns that are filed. These audits can be conducted either by correspondence, telephone, or in person. Having your return audited isn’t a walk in the park. The burden of proof is on you to substantiate your income and your deductions.
According to the poll 43 percent believe that the IRS maintains proper balance between tax enforcement and tax service; 30 percent of those polled stated that the IRS devotes too much time to enforcement.
The opportunity to cheat on your taxes is usually hard to do. Two-thirds of Americans that file their income taxes don’t itemize their deductions; instead they take the standard deduction. Those that do itemize their deductions are faced with the fact that financial institutions verify those deductions with the IRS, so there isn’t much wiggle room when it comes to cheating.
The fact of the matter is that cheating on your taxes is very hard to do. Most that try, will get caught.
For more information visit www.smalleynco.com
If you have any questions you can email Craig W. Smalley E.A.
Author of the books: It Starts With an Idea – Tax Tips for Small Businesses, The Ultimate Real Estate Investor Tax Guide, The Complete Guide to the New Tax Law – American Taxpayer Relief Act of 2012, Everything You Wanted to Know about the IRS – Audits, Appeals and Collections, Tax Avoidance is Legal! The Complete Guide to Individual Income Tax, The Complete Guide to the Affordable Care Act’s Tax Provisions, The Complete Guide to Retirement Plans for Small Businesses, The Complete Guide to Estate, Gift and Trust Taxation, The Complete Guide to Hiring an Accountant, The Complete Guide to Subchapter S-Corporations,, and Free Money. All available exclusively on Kindle
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