Question

1.  What is the primary difference between tax evasion, tax avoidance, and abusive avoidance? A. The means...

1.  What is the primary difference between tax evasion, tax avoidance, and abusive avoidance?

A. The means used to minimize one’s taxes.

B. The amount of the difference between the proper calculation and the improper calculation.

C. The timeframe needed for each.

D. Tax evasion only relates to state-level taxes while tax avoidance and abusive avoidance relates to federal level.

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Answer #1

B. The amount of the difference between the proper calculation and the improper calculation

EXPLANATION: Tax avoidance is the using of some legal methods in computation of taxes for reducing taxable income or tax owed by the taxpayer. it involves structuring affairs of tax payer so that you pay the least amount of tax due while as Tax evasion is the usage of illegal methods of concealing income earned by the tax payer or concealing information from the IRS or other tax authority with respect to income earned & expenses incurred.

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