6 LO Using the legend provided classify each of the followin

6, LO Using the legend provided, classify each of the following statements: Legend A = Tax avoidance E = Tax evasion N = Neither a. Sue writes a $707 check for a charitable contribution on December 28, 2017, but does not mail the check to the charitable organization until January 10, b. Sam decides not to report interest income from a bank because the amount is rather than waiting bonds to tax-exempt cial Security benefits so that 2018. She takes a deduction in 2017. only $19.75 until February 2018. d. Variet switches her investments from taxable corporate municipal bonds. Mel encourages his mother to save most of her So he will be able to claim her as a dependent. e.

Solution

A) Tax evasion

reason - because she has made the check but not emailed the check and she is also cailming deduction without making an actual contribution shows that her deed of claiming false contribution and tax evasion

B) Tax evasion

reason - sam is not reporting income that means he is hiding is source of income so that he can evade tax

C) Tax avoidance

he\'s paying property tax early so that he can claim these taxes to reduce his income tax liability

D) Tax avoidance

reason - since variet is switching her investment from taxableto tax exempt that means she\'s tryingto save tax from by adopting somelegal techniques or by involving in tax planning,so she is avoiding tax i.e. reducing her tax liabilty in legal way

E) Tax avoidance

Mel is encouraging his mother , this is also legal prcatice comes under the ambit of tax planning as he is not doing fraud not involving in false invoice or hiding reality,he\'s just investing his mother\'s income in some security benefits.