The last year has made taxes complicated. Not only is the whole system turned upside down by unemployment, but so many companies also need to hire new employees. As the end of the pandemic comes into focus, people will inevitably return to their lives.
There are so many people who need a job but there are also businesses that need to hire new employees. Competition will increase and companies will need to scrutinize prospective candidates not just to hire the best person for the job but to avoid tax fraud. A job background check is the best way to do both of these things at the same time.
Tax fraud is when a person or business entity willfully or accidentally leaves out information about their financials. When you leave out pertinent income, wages, or other taxable funds, it can lead to fines and other payments. Whether it’s intentional or not, tax liability will come back to haunt you.
When you hire someone who has lied about their work-related taxes, you might have to pick up the tab in the way of fraud fees. Even if the person was just negligent on their taxes, the company could be liable for the taxes. That’s why you should run background checks on every prospective employee candidate.
Why Background Checks Help
Background checks don’t just provide the criminal history of the candidate, they will give you other information about the person. Of course it will show you if the person is on the sex offenders list and if they have been convicted of a crime. This includes financial information pertinent to taxes, workers compensation information, their address, name history, and their driving record. Not only will you have the ability to verify the person’s education and employment history, personal and professional licenses.
Background checks can be done in the county, state, national, federal, and even international capacities.
When you do a background check you won’t just be able to hire the most capable and trustworthy employees, it will give your company an advantage to avoid tax fraud. This is because when an individual has willfully or unintentionally left out wages, incomes, and other taxable funds the cost can be pushed on the company.
There are a variety of ways the business will be left with the tab, it doesn’t matter whether it’s intentional or simply negligence.
If the person you are considering for hire didn’t intentionally leave out tax information, negligence can still lead to fines that can be quite hefty. It doesn’t matter whether you meant to lie or not, negligence still leads to tax fraud.
Fraud comes in many forms including deliberately underreporting or leaving out taxable income, overstating dedications, keeping two sets of records, claiming personal expenses as business expenses, claiming false deductions, making false entries in records, and concealing funds from the IRS.
Whatever your intentions, if you do one of these things it is considered tax fraud. If the individual doesn’t pay the taxes, the business may have to pick up the tab. As the world opens back up post-pandemic, companies will need to hire new employees but they also want to avoid tax fraud.
The pandemic isn’t over by a long shot, but as the light at the end of the tunnel shines brighter companies will hire more and more employees. Competition will increase and businesses will be more selective. They will run background checks to find out if they are a trustworthy person with integrity and to avoid unnecessary complications. Background checks make the whole process more convenient as companies continue to hire it will help them avoid tax fraud.
Creating a solid team is imperative to growing the business and thriving. If you hire a team of versatile and hard-working people you will be able to make the best company possible. When you show due diligence by running background checks, you will not just hire the best people and hard-workers it will help you avoid tax complications and fraud.
It’s pivotal to keep up with your finances by paying your taxes and find out who has lied about their taxes before you hire them.