San Antonio, TX asked in Tax Law for Texas

Q: Tax evasion or tax avoidance?

I have paid to have a nonprofit created for me from a trusted source. If it was formed incorrectly and I get audited for not paying the correct amount of taxes... Would this be considered tax evasion(jail time?) or just tax avoidance (legal, so just an extra fine)

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1 Lawyer Answer
Daniel W. Layton
Daniel W. Layton
  • Tax Law Lawyer
  • Newport Beach, CA

A: It isn't possible to answer your question based on the limited information provided and, because of the sensitive nature, I would recommend having a confidential consultation with an attorney subject to attorney-client privilege. When something is done wrong on your tax return, it not lawful tax avoidance - it is taxes due. It can be considered tax evasion depending on what you knew and when you knew it (and then willful blindness can also come into play). I recommend consulting with another attorney, especially since your question suggests a lack of comfort.

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