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Anonymous
Anonymous asked in Business & FinanceTaxesUnited States · 1 decade ago

is this tax evasion or tax avoidance? if a company that sell product, any products. this company doesnt want?

this company doesnt want to pay a lot of taxes. so they hire people to receive the checks that their customers send to the company for the products. so the people who received the check go and cash the check and then takes the money to company. is this tax avoidance or tax evasion? i need somebody who knows about what im talnking about. and plese give me an example of a company like this

Update:

is it is evasion. who would be responsible for it. the company or the people they hired?

Update 2:

what if the company pays the taxes for the check that the person send to them.??

5 Answers

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  • Anonymous
    1 decade ago
    Favorite Answer

    Sounds more like money laundering. Money laundering is the practice of engaging in financial transactions in order to conceal the identity, source, and/or destination of money, and is a main operation of the underground economy.

    Tax avoidance is the legal utilization of the tax regime to one's own advantage, in order to reduce the amount of tax that is payable by means that are within the law.

    By contrast tax evasion is the general term for efforts to not pay taxes by illegal means. The term tax mitigation is a synonym for tax avoidance. Its original use was by tax advisors as an alternative to the pejorative term of tax avoidance. Latterly the term has also been used in the tax regulations of some jurisdictions to distinguish tax avoidance foreseen by the lawmakers from tax avoidance which exploits loopholes in the law.

    Indentifying an example of a legal company engaged in money laundering is not posible.

  • Anonymous
    1 decade ago

    It is evasion and several other laws are being broken.

    It sounds like you might have been one of the people hired or know someone that was hired. The IRS can consider the amount of the check the person cashed at income to that person and require that person to pay the income tax on the money, plus penalties and interest. I have seen this done many many times. Also, the IRS could consider this fraud by the person cashing the check and the penalty for fraud it 75 percent of the tax. So the person would have the tax, the 75 percent penalty and then interest on both.

  • Steve
    Lv 6
    1 decade ago

    To me, it sounds like tax evasion. During an audit, the IRS looks at all bank deposits. These deposits would need to be explained by the company.

  • ?
    Lv 7
    1 decade ago

    Tax evasion, fraud, failure to collect sales tax, money laundering and list goes on.

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  • Tim
    Lv 7
    1 decade ago

    on the face nothing wrong, but sounds like they are trying to hide income. That would be evasion.

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