Reducing the burden of taxes is one of the best ways people can improve their financial situation, but some methods of avoiding taxes are less legal than others. Here are the most popular techniques that people use to lower their tax bills that can cause them serious legal problem.
Not Reporting Tips
Many people in service industries receive a significant portion of their income in tips. These tips are often given in cash, which is difficult for the government to track. The IRS tends to assume that if a person is reporting less tip income than others in their field, that person is cheating on their taxes.