Which of the Following Correctly Distinguishes Between Tax Evasion and Tax

Multiple Choice

Which of the following correctly distinguishes between tax evasion and tax avoidance?

A) Tax evasion is legal, whereas tax avoidance is illegal.
B) Tax evasion is illegal, whereas tax avoidance is legal.
C) Tax evasion involves taxpayers understating their incomes, whereas tax avoidance involves taxpayers overstating their incomes.
D) Tax evasion involves taxpayers overstating their incomes, whereas tax avoidance involves taxpayers understating their incomes.
E) Tax evasion is reported, whereas tax avoidance goes unreported.