If you’ve been wondering how to report tax fraud, the US tax department has created a guideline how to identify it, where to report it and how to report it. How to report a tax fraud might sound easy to do but if it involves the people you are working closely with, it might be quite difficult to do so. The Internal Revenue Service, however, made some program to encourage taxpayers how to report a tax fraud if they ever proved that there is such an illegal activity going on. They offer huge tax concessions which is as much as 15 percent of the amount not paid to those who will report these illegal activities. The big question, therefore, is what activity can be considered tax fraud? The IRS clearly states that any person or business that does not properly comply with tax issues such as deductions and false exemptions, kickbacks, altering or falsifying documents, failure to pay or withhold their tax, organized crime, and failure to report your exact income is a candidate for tax fraud.