QUESTION
Am I looking at criminal penalties for innocent errors made on tax returns 2 years in a row?
Asked on Apr 25th, 2014 on Taxation - California
More details to this question:
For year 2009 (single for me, received tax refund)-filed taxes myself in a hurry and forgot to enter information for 1 W2.- error was caught by IRS in 2011, additional tax/penalties assessed, installment agreement completed in 2013. For year 2010 (married joint, received tax refund)-also hastily prepared by myself and made a data-entry mistake from one of our W2's and also misunderstood the IRA deduction parameters and claimed it when I was not eligible. We discovered the 2010 error recently and just sent amended return, which is being processed by IRS. Are we facing criminal penalties for such mistakes? Once the 2009 error was discovered in 2011, we used HR Block for 2011, 2012, and 2013 returns with no problems.
3 ANSWERS
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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Criminal penalties are reserved for intentional tax fraud and for inducing others to commit tax fraud. Simple errors are handled by penalties and interest. Tax fraud generally involves a scheme to hide income - for example, Barack Obama had a Chicago gangland figure buy the vacant lot adjoining his home for $500,000 then sell it to Barack for $1,000 as payment for his involvement in the $45,000,000 subsidized housing scam. That's a scheme to defraud the government of taxes (of course, politicians don't get prosecuted)
Answered on Apr 25th, 2014 at 7:46 PM
Business/ Commercial Attorney serving Bellevue, WA
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Lana Kurilova Rich PLLC
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No, based on your facts, these are just errors and all the IRS wants from you is money. It looks like you have already paid for your first mistake and corrected your second one. SO you can relax and sleep at night just fine; there is nothing criminal here.
Answered on Apr 25th, 2014 at 1:06 PM
Taxation Law Attorney serving Glendale, CA
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Irsfeld, Irsfeld & Younger LLP
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No. No criminal penalties for these.
Answered on Apr 25th, 2014 at 12:33 PM