Yahoo Answers is shutting down on May 4th, 2021 (Eastern Time) and beginning April 20th, 2021 (Eastern Time) the Yahoo Answers website will be in read-only mode. There will be no changes to other Yahoo properties or services, or your Yahoo account. You can find more information about the Yahoo Answers shutdown and how to download your data on this help page.

RJ
Lv 5
RJ asked in Business & FinanceTaxesUnited States · 1 decade ago

Is this considered Income Tax Fraud?

If someone writes a letter to the state tax board that makes statements that are lies? (I'm in California- State of California Franchise Tax Board) I know someone who has not worked for over a year, sits around smoking pot all day and plays video games till the wee hours of the night. This person also has a 6 year old son that he does not support and lives at home with his parents; the parents allow this to happen as they think there is nothing they can do about it. The person owes almost $2,000 and since the person hasn't worked, is unable to pay this. The person wrote a letter to the tax board claiming he has been looking for work all year but the economy is bad, that he receives unemployment checks that he uses to pay for shelter, food, medical insurance, raising his son etc- these are all lies (I know this for a fact- I'm related to this person). He also stated that he lost his full time job in Dec 2008 when he actually walked off the job because of an argument he got into; he was not fired.

Is this considered fraud and could potentially be reported to the tax board for further investigation?

Update:

Yes I am seriously thinking about reporting it but do not want to make a false claim. Or a claim that has no relevance to tax fraud.

Update 2:

Hmmm very interesting. He did file for taxes, which is what I'm assuming the reason why he received a state income tax form. The State sent him a bill in which he owes almost $2,000. I just think it's very irresponsible of a person to type a letter with bold face lies just to be able to defer the payment of taxes; especially when he isn't actively searching for a job.

6 Answers

Relevance
  • 1 decade ago
    Favorite Answer

    The FTB knows if he's been collecting unemployment benefits from EDD. If he lies about that, they already know that it's a lie so there's nothing for you to report, whether it rises to the level of fraud or not. The authorities are only interested in information that they do not have access to and could not reasonably discover on their own. Your post hasn't revealed anything relevant to tax fraud, nor has it revealed anything that the FTB would not be able to figure out should they wish to know.

    Not paying an established tax debt is NOT tax fraud. Tax fraud involves making false statements about income or expenses, often combined with active measures to hide taxable income from detection, in order to falsely reduce the amount of tax that is due. Nothing in your post would indicate that this is the case.

    At most he's failing to pay a legitimate debt and in the US that is NOT a crime. His debt will continue to climb as penalties and interest are tacked on. At some point he'll be forced to seek a job for survival and at that point the FTB will swoop in and levy his wages to force repayment of what he owes. Either that or he will wind up homeless on the streets.

    If he's collecting unemployment benefits -- your post does not say that he is, only that he told the FTB that he is -- and is not actually seeking employment the odds are good that he will be caught when they audit his unemployment claims. The odds of an eventual audit are high if he's been collecting for more than a few months. When he's caught, he'll be forced to repay any illegally claimed benefits and future benefits will be cut off. That will probably motivate him to get off of his @$$ and find work, particularly if it comes down to a matter of survival.

  • 1 decade ago

    The information is still too general and vague.

    You don't know if he files his taxes since it wasn't stated so you can't assume he's cheating on his taxes by not paying reporting the income and not paying the income taxes.

    He appears that he may have committed fraud on his unemployment claims but that's through the state (i.e. he quit his previous job instead of being fired).

    As long as a person supposed claims to look for work, then the state unemployment agency will have to take his word on it.

    If you do plan on reporting your relative (Be careful!), then you need to get the facts correct first.

    Good luck!

  • 1 decade ago

    The son's mother should be able to report him. If she can prove her son is not being supported by the father than that's 1 lie that he will have to face. If she also happen to mention everything else then if they do decide to investigate then he will need to provide proof. The mother should go to court and ask for child support. The fact the father mentions he supports kid and her asking for money will set off an alarm and give her more of a leg to stand on. You reporting this will not do much unless you have proof. good luck.

  • tro
    Lv 7
    1 decade ago

    if he is claiming unemployment and receiving it apparently the former employer complied and allowed the unemployment to be granted

    if he is getting unemployment and not really seeking employment his unemployment should be denied but this is not fraud(if he were getting unemployment and working too that would be fraud)

    his parents are in the position to report him to child welfare based on his negligence and subjecting the child to unhealthful conditions, but it is their home and they could be putting themselves in a bad position

    from what you are saying the parents should be claiming the grandchild as a dependent and the couch potato as a qualifying relative(there are several requirements that have to be met)

  • How do you think about the answers? You can sign in to vote the answer.
  • danko
    Lv 4
    5 years ago

    i do no longer comprehend approximately California regulation on the subject of tutorial training value exams. This sounds like something the exertions Board (state and federal) could prefer to look into, as that's frequently a criminal offense to for an corporation to require an worker pay the corporation for the priviledge of working for that corporation. Relative or no relative. And if the worker is "returning" better than 13,000 US money to the corporation, there's a federal "present tax" due.

  • 1 decade ago

    Not really income tax fraud - he will be taxed on his unemployment benefits. But, it might be unemployment insurance fraud because in order to receive benefits he has to be both willing and able to work.

Still have questions? Get your answers by asking now.