Taking advice from friends you know and talk to regularly who are not very ethical themselves can lead to real disasters. Tax laws are spelt out by the IRS they have extensive guidance with case law to back this up. Specialist licensed tax experts and accountants with many years of knowledge know that crazy ideas learned from James or Liam over a few drinks at the Bar are usually not the best tax deduction ideas to follow. All too common ones include; Paying for personal food and calling it business entertainment. Putting in fictitious receipts for personal items that are not business-related. "Oh, We fit a new kitchen in the Office". Then they provide receipts of a kitchen delivered to their house! Taking money out of business transferred to the taxpayer's personal account then trying to call it a business expense! Going on holiday with the family (Family names can be seen on the flight & hotel booking receipts) then calling it a business training trip! Tell a customer that they can pay you in cash and you will deduct the VAT off the bill! Then not declaring the income. Putting in thousands in road mileage expenses when the official vehicle service records show much lower mileage. The all too common ones just roll off the tongue when the taxpayer is trying to pull a fast one. As always the excuse is "My mate Noah or James etc does it and his accountant says its fine." Other ones include "My Mate got a Large refund from his CPA you can get me one too. It's just so funny that after 30 years in the industry, the unethical taxpayer will always come forward with the same excuses and misconceptions. In all honesty, I am blunt and clear from the onset that we only deal with straight taxpayers who wish to declare their income and expenses correctly. Sometimes we miss this until part way through the year. So we continue to complete the returns our way. Obtain a written disclaimer from the client alongside the letter of engagement confirming any grey areas that we have advised to be cleared up. Advising we will not file the return until we have a disclaimer. Then in the second year of service, at Total Books Accountants we hike the fees so high that the shady people just leave. With our ethics as licensed practitioners to report Fraud to the Tax authorities. I would always beware of trying to pull a fast one by using your mate down the bar as an excuse to try and commit tax evasion/Fraud. We've heard it all before.
A big misconception is that W2 earners can't access meaningful deductions. I address this by introducing them to oil and gas investments, which allow deductions for intangible drilling costs. These can offset active W2 income immediately, saving tens of thousands on taxes in high-income years. For example, if you invest $50K in a qualified project, you could deduct up to 90% of that in the same year, directly reducing your taxable income. It's ideal for high-income professionals looking for legal ways to lower their tax burden while diversifying their portfolio. Plus, the income generated from these projects often qualifies for additional tax benefits like depletion allowances.