Can you be prosecuted for tax information which would lead to an overestimate in the amount of taxes you owe? Suppose you pay more taxes than you owe, either because you neglect to use a tax credit or deduction that you could claim, you put $0 for charitable giving as a result of forgetfulness, poor record-keeping, or wanting to avoid overestimating, etc. The end result is that you end up paying more taxes than what you were required to pay. Is this legal? Also, what happens if you forget about a small transaction? For example, suppose you make $100K at your job, but also made $25 of taxable income selling your stuff to a friend, but you forget to include the latter under taxable income.
The tax man always wins. You can make mistakes to your own detriment, but not to the detriment to the state. Forgot to take a deduction that was available to you? Perfectly legal. You're not required to “optimize” your taxes. Forgot to declare taxable income? That is a problem, and you would need to amend your filings. You are required to accurately disclose all of your taxable income. Of course, not all income is taxable income. For example, occasionally selling personal items for less than their original value (i.e. at a loss) is not taxable.
Usually I would think one answer to a question is enough. But since your edits have transformed a reasonable procedural question into what appears to be a rant about unfairness of the sort which any bankruptcy court has heard hundreds of times before, I will give another piece of advice: Focus on one thing at a time. The judge at the hearing of the application will be deciding (if your question is accurate) the single point whether a house should be sold. The submission "There is an application to annul the bankruptcy to be heard on XXX; if it succeeds this application is a waste of money and if it fails there will still be time for this application before the time limit, so you should adjourn till YYY" is a reasonable one that he will take into account. Saying "The bankruptcy order should never have been made; it was a mistake by my accountants and HMRC, and a High Court Judge joined in the conspiracy" will get you precisely nowhere. Even if the judge believed you rather than the written evidence, it has no bearing on the point he is being asked to decide. More generally; besides casting your arguments into proper shape, there is another good reason to consult a professional, namely that he can tell you when to give up. The courts are bound by laws and regulations; however unfair you may think the result, at some point it is necessary to accept the reality rather than wasting time and money making points that the law cares nothing about. (And no, I see no point discussing this further in comments. This answer can be upvoted if you think it helpful or downvoted if you think it "not useful"; it isn't something to argue against.)
If your friend was a salaried W2 full time exempt employee hired by the company to, among other things, write software like this, then the fact that it was developed "off the clock" with the employee's own resources means nothing once he gives it to the company. I mean if I give you a present and it blows up and breaks your arm, I'm still liable even if we didn't have a "contract" - especially if I knew it would blow up. Your friend's position is even worse since the relationship entails the employee's having the employer's best interests in mind. If I were your friend, I'd either figure out how to fix this or take gnasher729's advice from the comments and find a country where it's easy to hide from parties public and private. Maybe buy a bunch of canned food and go live on a boat?
It is certainly possible to give gifts to your relatives (or to anyone really). But, the harder question is whether or not it is really a gift. A characterization of a transaction as a gift is less likely to be questioned if it is between related parties, and it is less likely to be questioned if it isn't obviously a quid pro quo. If you told your brother that you would make a gift to him of all of the appreciation in the house, if he made the guarantee in advance, it would be a guarantee fee (or an equitable or nominee ownership) rather than a gift. But, with the timing and motives described in this post, it is certainly a closer call. The fact that the "gift" amount exactly matches the appreciation casts doubt on the theory that this is really a gift, but doesn't absolutely clearly require the conclusion that it is not. This could end up being resolved either way, and ultimately, could be very dependent upon the detailed facts and how they are presented to the person determining if tax is owed.
People make mistakes. My assessments come with information on how to dispute them, and if yours don't you should be able to get that information. File a dispute or whatever it is you do to challenge the assessment. Include the information about you being outside the district and not having he measure on your ballot. If you're just outside the district, you might have been mistakenly included. You'll either get a revised assessment or you'll be told that you have to pay the tax. You don't have a reasonable complaint unless and until your challenge is denied.
No IRS Pub. 526, Table 1, lists &quot;Value of your time or services&quot; under &quot;Not Deductible As Charitable Contributions&quot;. This is repeated several other places in the document. However, expenses incurred in the course of providing the services can be deductible in some cases. There's more specific information for lawyers at https://practice.findlaw.com/practice-guide/tax-deductions-for-lawyers-providing-pro-bono-services.html.
Under U.S. law, each donor can give up to $15,000 per person, per year to as many people as desired gift tax free (this is called the &quot;annual exclusion&quot;). So, yes you could. The gift tax portion of the Internal Revenue Code is specifically designed so that de minimis gifts don't have to be accounted for. Also, the amount of the gift for gift tax purposes if you had 11.8 million co-owners of an account would be 1/11,800,000 dollars, not $1 dollar each. While co-ownership of a joint account is a gift, it is not a gift of 100% of the value of the co-owned account to each co-owner. The default rule in absence of evidence to the contrary, is that co-owners of property have equal ownership of it. Adding one joint owner to a solo account is a gift of half of the amount in the account.
You would report illegal income via Schedule 1, line 8. At the bottom, after naming many specific legal sources of income there is a line 8z &quot;Other income. List type and amount&quot; with very little space. The instructions refer you to Miscellaneous Income in Pub 525. They do list &quot;Stolen Property&quot; as a category, saying If you steal property, you must report its FMV in your income in the year you steal it unless in the same year, you return it to its rightful owner. However, there is no requirement to report the illegal nature of your income, and it is not difficult to describe such income in non-incriminating terms, such as &quot;miscellaneous income&quot;. If they are not satisfied, you may inform them of your 5th amendment right to not incriminate yourself. Invoking your right to silence does not constitute probable cause for a search warrant.