It is never a good idea to guess when filling out a tax return. Instead, you should find a tax advisor in your area who is qualified to help you determine if you’re eligible for a credit or deduction. Let’s look at some of the potential consequences of submitting an inaccurate state or federal tax return.
You Could Be Subject to Financial Penalties
If the IRS rules that you aren’t eligible for a tax credit, it could add hundreds or thousands of dollars to your outstanding tax bill for the year. The same might be true if you underreport your income or try to claim that a personal asset was used for business purposes.
Additionally, the government will likely add a late fee and charge interest on the past due balance. Finally, you could be subject to fines or other punitive damages in the event that you willfully violated the tax code. In such a scenario, it may be a good idea to find a tax advisor who can help you in your battle against the government.
The Government Might Pursue Criminal Charges
As a general rule, the government doesn’t press criminal charges against those who make honest mistakes. However, if you willfully attempt to defraud the federal government, there is a good chance that you could face jail time or other significant penalties.
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