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Bellizia Law Office
395 Franklin Street
Bloomfield, NJ 07003
Tel: 973-743-2220
Fax: 973-743-2290
info@prosperlawoffice.com
Fraud is defined to be "an intentional perversion of truth" or a "false misrepresentation of a matter of fact" which induces another person to "part with some valuable thing belonging to him or to surrender a legal right".
In addition to the traditional criminal definition of fraud, there are many regulatory laws that have very specific rules that must be complied with. If you do not follow these rules to the letter, you could be charged with and convicted of fraud.
The courts recognize the fact that no taxpayer is obliged to arrange his/her affairs so as to maximize the tax the government receives. Individuals and businesses are entitled to take all lawful steps to minimize their taxes.
A taxpayer may lawfully arrange his/her affairs to minimize taxes by such steps as deferring income from one year to the next. (For example, interest on property sold on 12/31/98 is taxable as part of 98 income. If the property is sold on 1/1/99, it would be taxable as part of 99 income. This is legal to do.) It is lawful to take all available tax deductions. It is also lawful to avoid taxes by making charitable contributions.
If you have an obligation to file a return, your failure to do so can also subject you to penalties.
Tax evasion is a crime. Tax evasion typically involves failing to report income, or improperly claiming deductions that are not authorized. Examples of tax evasion include such actions as when a contractor "forgets" to report the $10,000 cash he receives for building a pool, or when a business owner tries to deduct $100,000 of personal expenses from his business taxes, or when a person falsely claims she made charitable contributions, or significantly overestimates the value of property donated to charity. Similarly, if an estate is worth $5 million and the executor files a false tax return, improperly omitting property and claiming the estate is only worth $100,000, thus owing much less in taxes.