How to Report Tax Fraud

Step-by-Step Guide

1. 1

   Step 1: Determine when tax fraud should be reported.

   The IRS is a relatively small governmental body compared to the size of the US population.
   
   Because it only audits about 1% of the population, it needs to choose its targets carefully.Help the IRS out by blowing the whistle on truly significant instances of tax fraud.
   
   A multi-national company serially underreporting its income in order to pay fewer taxes is significant, but a babysitter failing to declare the $40 of income is not.The IRS is seeking solid and comprehensive information, not speculation or educated guesses.
   
   Tax fraud reporting is meant as a way to tackle serious fraud not to resolve personal disputes.
   
   The IRS offers rewards for information, but often the amount in dispute must exceed $2 million, or the individual have an income of over $200,000 to qualify for a significant reward.
   
   These guidelines reflect the IRS’s desire to catch major tax offenders.
2. 2

   Step 2: Download Form 3949-A.

   The main way to report suspected tax fraud to the IRS is by downloading and completing the relevant form from the IRS website.
   
   You can download a PDF of Form 3949-A directly: https://www.irs.gov/pub/irs-pdf/f3949a.pdf.
   
   This is the form you should use if you know or suspect a person or business is not compliance with tax law on issues such as:
   Failure to pay tax, or unreported income.
   
   False tax exemptions or deductions.
   
   False or altered documents.
   
   Kickbacks.
   
   Organised crime.
   
   Failure to withhold., In order to fill out the form you will need to provide information about the person or business you are reporting.
   
   If you are reporting a person, you are asked to provide their name, address, Social Security number, date of birth, occupation and email address.
   
   You can fill in the form on your computer and print it out.
   
   If you are reporting a business, you should provide the name, address and Employer Identification Number as well as a description of the type of business.
   
   You are asked to provide as much information as you can, and leave blank any sections you cannot complete., The form includes a section where you should outline the alleged tax violation you are reporting.
   
   Use the check boxes on the form or the space provided for a description.
   
   Specifying which laws the person or employer violated will give the IRS a starting point with which to launch the investigation.
   
   Here are some common tax law violations:
   The most common occurrence of tax fraud is overstating charitable donations, especially church donations.The most significant form of tax fraud, dollar-wise, is under-reporting income.Stowing away money in foreign tax havens is another punishable offense. , The form invites you to provide your name, address and phone number.
   
   The informant's information isn't required for the IRS to process a report of tax fraud, but it can be helpful if the IRS need to contact you for any follow-up or further information.
   
   If you do choose to provide your identity, know that the IRS will keep your identity confidential.An anonymous fraud reporter may not be able to collect a reward, if the IRS chooses to issue one. , Once you have completed the form, mail it to the IRS to be processed.
   
   Mail the completed form to the Internal Revenue Service.
   
   Send it to:
   Internal Revenue Service, Stop 31313, Fresno, CA
   93888.
3. 3

   Step 3: Provide information about who you are reporting.

4. 4

   Step 4: Indicate the type of tax law violation.

5. 5

   Step 5: Decide whether to provide your contact details.

6. 6

   Step 6: Send in the form.

Detailed Guide

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