IRS Polices What Is Tax Planning Or Tax Evasion

Tax planning–even tax avoidance–can be OK, but not tax evasion, so how do you tell the difference? It is tax filing season and whether you’ve started or not, it isn’t pleasant. And the stakes are high. After all, every IRS tax return must be filed under penalties of perjury. Many people assume that the IRS will not impose penalties if you weren’t actually trying to cheat on your taxes. Taxes are complex, and mistakes happen. But the burden is on you to show that you acted reasonably (such as by relying on professional tax advice). If you can’t, you will probably end up with penalties.

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