Mississippi Tax Fraud and Tax Evasion Laws

The terms "tax fraud" and "tax evasion" are often used interchangeably to describe the crime of willfully underpaying your taxes. The Mississippi Department of Revenue describes tax fraud as "cheating" by intentionally not paying your fair share of taxes. Common examples of tax fraud include the following:

Intentionally failing to file a tax return
Failing to report all income received
Claiming to be a resident of another state while living in Mississippi
Overstating expenses to reduce income
Making false or fraudulent claims for refunds
Under-reporting sales
Selling beer or tobacco without paying the excise tax
Operating a business under someone else's name in order to avoid taxes
Paying cash wages to employees for the purpose of evading taxes
Collecting and not remitting sales taxes

The following chart highlights Mississippi's main tax fraud and tax evasion laws.

Code Section	Mississippi Code of law section 27-3-79: Tax Evasion
What's Prohibited?	Willfully attempting (or assisting someone else) to evade or defeat any tax imposed by the State Tax Commission or the Department of Revenue.
Penalties	Felony. Punishable by a fine of up to $100,000 for an individual (or $500,000 for a corporation), and/or imprisonment for up to five years.
Statute of Limitations	Any prosecution for tax evasion under this law must begin within six years after the taxes at issue were due.

Fraud vs. Negligence

Under Mississippi's tax evasion laws, fraud can only be committed if the offender acted willfully. In other words, before an offender can be found guilty the prosecution must prove that he intentionally tried to avoid paying a tax. The tax code can be very complicated and honest mistakes are frequently made. Mistakes that were made without the intent to defraud will likely be attributed to negligence, rather than to fraud.

See Income Tax: Fraud vs. Negligence for additional information.

Reporting Tax Fraud

The Mississippi Department of Revenue urges private citizens to report suspected tax fraud in order to help ensure that taxes are collected and remitted fairly. You can report tax fraud electronically by completing the Tax Fraud Referral Form. Reports can be made anonymously, but if you choose to provide your contact information the Department of Revenue will keep your identity confidential.

Additional Resources

State laws change frequently. For case specific information regarding Mississippi's tax fraud and tax evasion laws contact a local tax attorney.