Expert Advice When You Need It Most

If a company creates a rental invoice that has fraudulent "tax exempt" fees on it.. Is it tax evasion

Asked over 2 years ago - Los Angeles, CA

A company creates a rental invoice that has fraudulent "tax exempt" "political subdivision" collected fees on it and the law states that all charges for a "lease" that are not specifically defined are subject to tax. This company advertises worldwide thru the internet

What can they be charged with ?
The fees collected were not taxed... Tax Fraud ?
The fraud was on the internet and victims live out of state... Federal ?
Wire Fraud ?

Additional information
I'll try again... Political subdivision = government agency or arm with certain defined criteria. They assess a fee on all rental vehicles that have access to the airport. A scab company books reservation and charges this fee they dont/cant pay anyway. This is the fraud. the law states you must pay tax on "all charges" on a rental contract not specifically excluded. This fee is excluced... except, its fraud and not real on this reciept. They charged it, recieved it, but didnt pay it. If this scam falsely creates a lower price and this "make-up" fee is not taxed, the government has missed their tax on the difference,in $3-6/ rental and they rent @1000/day. However... is this fraud tax fraud, regular fraud, internet fraud.... etc ?

Flag

Save

Share with:

Attorney answers (2)

Kenneth Lewis Swenson

Reputation Level 15

Answered over 2 years ago. Litigation Lawyer in Yuba City, CA.

Flag

A government fee collected by a rental agency is not a lease charge subject to tax.

Mark as good answer

7 people marked this answer as good

Add comment

Ronald Anthony Sarno

Reputation Level 20

Answered over 2 years ago. Litigation Lawyer in New York, NY.

Flag

The perpetrators of this fraud are most likely sitting in an internet cafe in Lagos, Nigeria laughing their heads off, First of all anyone who bought into this scheme is subject to a tax evasion charge from the federal and state authorities, As for the perpetrators, you can be sure the names and companies they used are non existent.
They can be charged by the government with aiding and abetting tax evasion. I do not believe the users of this scheme have any cause of action since common sense would tell them they are not a political subdivison exempt from taxes.

You might find my legal guide on selecting and hiring a lawyer helpful.
You might find my legal guide on Is it Legal? Is it Illegal? helpful.
You might find my legal guide on the understanding the different court systems helpful.
You might find my legal guide on legal terms used in litigation helpful.
(Even if you are not filing a lawsuit this information can be useful).

You might find my legal guide on commercial litigation helpful.

LEGAL DISCLAIMER
Mr. Sarno is licensed to practice law in NJ and NY. His response here is not legal advice and does not create an attorney/ client relationship. The response is in the form of legal education and is intended to provide general information about the matter in question. Many times the questioner may leave out details which would make the reply unsuitable. Mr. Sarno strongly advises the questioner to confer with a local attorney about this issue.

Mark as good answer

8 people marked this answer as good

Add comment

One or more answers have been taken down.