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The Associated Press today (April 14) has a story on where tax cheats are likely to be clustered, according to data from the National Taxpayer Advocate. It used confidential Internal Revenue Service data from 2009 tax returns to try to pinpoint localities where tax cheats may be. The study focused on sole proprietorships, mainly small businesses. Construction companies and real estate rental firms may be more likely to fudge on their taxes, says the A.P. The places cited in San Diego County are Alpine, Bonita, Ramona, Rancho Santa Fe, San Marcos, and Valley Center. Two locales that are close to San Diego County are on the list: Murrieta Hot Springs and Temecula.

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Visduh April 14, 2013 @ 7:28 p.m.

Isn't the option to cheat on taxes always assumed if you are a sole proprietor? I mean, Schedule C is often called a license to steal. Convert a whole host of personal expenses into business expenses, and viola, you owe nothing to the taxman. (The dirty little downside secret is that by avoiding the income tax, you also avoid the always-burdensome self-employment tax. That SE tax can really wreak havoc with your cash flow. But, ya' see, if you don't pay into social security via the SE tax, there's little or no social security benefit waiting for you when you are too old to keep working.) No, put self employment together with cash-only transactions, and it is possible to live very nicely without owing anything to the IRS or the FTB. That is, until they catch up with you. If they do. Or maybe they don't. Who knows?


Don Bauder April 14, 2013 @ 9:12 p.m.

Visduh: The National Taxpayer Advocate exists to assist the IRS. Somebody within a cluster is more likely to be audited. According to the A.P., sole proprietorships have more opportunity than individuals to cheat on their taxes, because many small businesses deal in cash, as you point out. Best, Don Bauder


MURPHYJUNK April 15, 2013 @ 7:35 a.m.

Notice who pays cash ( no checks or loans) to buy new cars to find real leads as to who is dealing in cash.

Small immigrant ( the legal kind of immigrant) owned businesses are adept at hiding cash, as arriving from the third world they had to do it there to survive.


Don Bauder April 15, 2013 @ 8:51 a.m.

Murphyjunk: No question: cash businesses lend themselves to tax chiseling. Best, Don Bauder


Ponzi April 17, 2013 @ 10:29 p.m.

I know people who don't file a Schedule C at all.

@ Visduh, you only need to work "40 quarters" to qualify for social security. That is 10 years of W-2 or Self-Employment tax work. Once you have completed that, you are going to get social security even if you never work another day in your life.

@ Murphyjunk, yes we have some savvy tax dodgers with "legal" immigrants. Whether they came "fleeing" persecution (which can even be a Chinese national objecting to abortion -- so 1/2 billion potential "refugees") or someone from a Middle-East country who has the literacy, connections and money to hire an immigration shark, America is filled with expert tax cheats. Liquor stores, food service, taxi income or just plain old fashioned Pell Grant and Welfare fraud, we are inviting over many scammers every month.


Don Bauder April 18, 2013 @ 6:57 a.m.

Ponzi: We all know that the U.S. is filled with tax cheats who operate in the underground economy. This has been true for decades and decades and decades. And the rich routinely stash money in offshore tax havens, dodging either taxes or American regulatory requirements, or both. (See: Mitt Romney.) But on a percentage basis, we can't top countries such as Greece and Italy. In those countries, and many others, deeply inculcated tax dodging is a major cause of the deficit problems. Best, Don Bauder


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