Tax Fraud & Tax Evasion in Bethesda
& Finding a Tax Fraud Lawyer
Tax fraud and tax evasion are illegal activities that can result in stiff penalties, including fines and imprisonment. However, there are critical differences between the two. Tax fraud is a deliberate attempt to misrepresent information on a tax return to reduce the amount of taxes owed. For example, a taxpayer might claim false deductions or inflate their expenses. Tax evasion in Bethesda is an illegal act of purposefully avoiding paying taxes. This might involve hiding income or assets, failing to file a return, or failing to pay taxes when they are due.
While both tax fraud and tax evasion can lead to criminal charges, tax evasion is considered a more serious offense. This is because it represents a willful attempt to cheat the government out of revenue, whereas tax fraud is typically seen as an act of deception. If a person commits tax evasion, they likely didn’t pay their taxes or didn’t file them at all. As a result, taxpayers convicted of tax evasion may face more severe consequences than those convicted of tax fraud.
Filing your taxes can be a complicated and stressful process; you must ensure you’re honest and accurate in your return. If you’re caught committing tax fraud or tax evasion, the consequences can be serious. You may be subject to fines, interest, and penalties, and in some cases, you may even face jail time. In addition, the Internal Revenue Service (IRS) may audit your return for multiple years, which can be a time consuming and expensive process. Being honest on your taxes can save you the hassle and stress of dealing with the IRS down the road.
Different Methods Used To Commit Tax Fraud and Tax Evasion
There are several different ways that people commit tax fraud. The most common method is by claiming false deductions or inflated business expenses. People might also try to hide income by using offshore bank accounts or by under-reporting the amount of money they’ve earned. Others may attempt to claim personal expenses as business expenses to get a bigger tax deduction. Whatever the method, tax fraud is a serious crime that can lead to heavy fines and even jail time.
The most common way people try to avoid paying taxes in Bethesda is by failing to report all of their income. Others might try to claim excessive deductions or take advantage of loopholes in the tax code. No matter how someone tries to evade taxes, the result is the same — they end up owing back taxes, plus interest and penalties. In some cases, criminal charges may be filed as well.
How To Protect Yourself From Becoming a Victim of Tax Fraud or Tax Evasion
There are a number of ways that individuals can protect themselves from becoming victims of tax fraud or tax evasion. First, it is important to be aware of the potential risks. Be sure to keep your personal information safe and secure, and be diligent about who has access to it. If you receive any suspicious communications that claim to be from the IRS or another tax authority, do not respond, and do not click on any links or attachments. Instead, report the incident to the authorities.
It is also a good idea to review your tax filings carefully before submitting them. Check for any errors or red flags that could indicate fraud or evasion. If you are using a Bethesda professional tax preparer, make sure they are reputable and trustworthy. Finally, stay up to date on the latest scams and schemes so that you can recognize them if you come across them. Taking these precautions can help safeguard yourself against becoming a victim of tax fraud or tax evasion.
Delia Law Can Help With Tax Fraud and Evasion in Bethesda
At Delia Law, we understand the complexities of tax law and the challenges of complying with all the rules and regulations. We also know that sometimes people make mistakes or knowingly engage in tax fraud or evasion. If you are facing an IRS audit or investigation, we can help. Our experienced tax attorneys will work with you to develop a strategy for responding to the IRS and protecting your rights. We will also represent you in court if necessary. We will aggressively defend your case and work to get the best possible outcome.
We also proudly support victims of tax fraud and tax evasion. If you have been the victim of a tax scam, we can help you recover your losses and get your life back on track. We are hyper-focused on the latest techniques and strategies used by tax scammers, and we are committed to helping our clients protect their hard-earned money. If you are facing tax-related problems, contact Delia Law for help. We are here to protect your rights in Bethesda and fight for you.
Maryland-Specific Tax Laws
Maryland has a progressive tax system, which means the higher an individual’s income is, the higher the percentage they will pay in taxes. Maryland has special tax benefits for military retirees, lower income families, those paying for childcare, as well as for those aged 65 and older.
There are four types of taxes in Maryland:
- State income tax. The state tax rate for personal income tax begins at 2%. This is applied to anyone making under $1,000 per year in annual income. It increases up to 5.75% for anyone making over $250,000 annually. This is one of the lower state income tax rates in the United States.
- Local income tax. There is also a local income tax, which is levied by counties and cities. For convenience, these are withheld during income tax season by the state, and they vary based on the locality. For example, if you live in Allegany County, you paid a .0305 tax rate in 2021. This differs from residents of Baltimore County, who had a .0320 rate. It is important to note that this income is based on the county you live in, not where you work.
- Sales tax. With each purchase in Maryland of a good or service, a 6% sales tax is automatically applied. This does not include every purchase. Groceries, prescription drugs, and gasoline are a few examples of items not subject to sales tax. However, a business is required to collect a 9% tax on any alcoholic beverages sold.
- Property tax. You must pay property taxes in Maryland as well, and the tax rates vary by county. The average effective tax rate is 1.06%. While this might seem low, it is balanced by the high property values in the state. The median home value in Maryland is currently over $400,000 and varies based on proximity to the city of Maryland and other populated areas.