Define "tax evasion."

Tax evasion refers to the illegal act of deliberately avoiding paying taxes owed. This typically occurs when individuals or entities underreport their income, overstate deductions, or engage in other deceptive practices to misrepresent their financial situation to tax authorities. Such actions are against the law and can result in severe penalties, including fines and imprisonment.

This definition aligns with the concept that tax evasion is not simply about not paying taxes but involves a willful intent to defraud the tax system by providing false information. Understanding tax evasion is critical as it is a serious offense, contrasting sharply with legitimate tax avoidance, where taxpayers utilize lawful strategies to minimize their tax liabilities without deceitful practices.