Excise Tax Fraud


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Excise taxes are taxes on the purchase of a particular quantity of a particular item, such as gallons of wine or gasoline, much like a sales tax. An excise tax, however, is very different from a sales tax. A sales tax is paid by the buyer; an excise tax, by the manufacturer or retailer. A sales tax is not included in the purchase price; an excise tax is. A sales tax is generally state or local, not federal; an excise tax may be state or federal.

One of the forms of tax fraud the IRS has recently been diligent in pursuing is excise tax fraud. For anyone who owns a business that buys and sells things, knowing about excise taxes is vitally important to be able to insure that you donít end up under an IRS criminal investigation. Hiring a New Jersey tax attorney with experience in excise tax fraud can make sure that, if you are prosecuted for excise tax evasion, you have the best defense possible.

Excise taxes are taxes on the purchase of a particular quantity of a particular item, such as gallons of wine or gasoline, much like a sales tax. An excise tax, however, is very different from a sales tax. A sales tax is paid by the buyer; an excise tax, by the manufacturer or retailer. A sales tax is not included in the purchase price; an excise tax is. A sales tax is generally state or local, not federal; an excise tax may be state or federal.

Excise tax evasion, very simply, is not paying the full amount of excise taxes that you owe. Many people who do excise tax evasion are criminals who come up with clever schemes to sell alcohol, fuel, cigarettes or other items that have excise taxes without paying their full share of taxes. However, other people who commit excise tax evasion may simply not be aware of the IRS and Bureau of Alcohol, Tobacco, Firearms and Explosives rules about tax evasion. Still others may be victims of an accountant who promises big savings on your taxes. A New Jersey tax attorney can defend you from an IRS investigation of your business.

There are certain signs the IRS watches for to determine if someone may be perpetrating excise tax fraud. If a taxpayer suddenly stops filing excise tax returns without explanation, sold an item at a tax-included price but didnít report or pay the tax to the government or handles two identical products but doesnít pay taxes on one of them, an investigation may begin. During this investigation, having a skilled New Jersey tax attorney on your side can make the difference between prison time or a fine and walking away with your innocence proven.

ABOUT THE AUTHOR: Kevin E. Thorn
Thorn Law Group, a New Jersey Tax Law Firm, consists of a professional team of attorneys and lawyers providing legal assistance to the clients in resolving business tax, criminal tax law, offshore bank accounts, international tax disputes and professional ethics problems.

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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.

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