Tax exempt purchases - how are they tracked?

[FlyingJ 0]

I found out yesterday that one of my co-workers uses our company's tax exempt status for pretty much every personal purchase he makes. He bought a new ipod and made the comment that "it was sweet to be able to get it tax exempt."

Aside from the fact that it is flat out tax fraud, I told him I would be really worried about it biting him in the ass and getting him in some trouble. He was completely dismissive about it.

Does anyone know how exempt purchases are tracked (if they are at all)? I would like to give him some more info about how he could be getting both him and our company in some trouble, but I really don't have it and haven't been able to find it online.

Killing threads since 2004.

[BIGUN 1,486]

He's facing;
Termination (and a blot on his record for future employment)
Tax Evasion.
Tax Fraud
Theft of services.

I just terminated and prosecuted an employee for a similiar situation - sentencing date is the 27th. He faces up to five years in jail since it was $16K (which will probably be house arrest (ankle bracelet), community service, five years probation and full restitution.

Sooner or later - ya gets caught.

http://www.assetprotectionbook.com/irc_sec_7201.htm

Nobody has time to listen; because they're desperately chasing the need of being heard.

[FlyingJ 0]

That right there is pretty much the gist of what I told him, but the response to that was "so how will they know - who tracks this stuff?"

That's the part I couldn't answer because I really don't know. I think telling him about what could happen was probably enough to get him to stop, and it doesn't seem like it has been going on for long, but it is certainly a messed up situation.

Killing threads since 2004.

[Remster 30]

Quote

who tracks this stuff

Two groups will track that stuff.

The controler at his company will no doubt get paper work for any tax exemption requests filled using the company's tax code. These guys are usually VERY anal.

And if he is ever audited by the IRS, well, you know.. They're kinda anal too

Remster

[FlyingJ 0]

Quote

The controler at his company will no doubt get paper work for any tax exemption requests filled using the company's tax code.

Do they? That's the kind of thing I want to pass on, that it's going to bite him in the ass when someone is looking down the list of purchases and wonders WTF!

Killing threads since 2004.