While people do not enjoy paying taxes, doing so is a requirement for most individuals each year. However, while the tax code has gotten more complex over the years, many taxpayers make mistakes on their returns. While this is not considered a crime, tax evasion is a different matter. Defined by the IRS as the willful under-reporting of income or claiming deductions to which one is not entitled, tax evasion is a serious offense that can lead to a variety of legal consequences.
Multiple Types of Tax Evasion
What many people don’t realize is there are two types of tax evasion, those being evasion of assessment and evasion of payment. With an evasion of assessment, a person commits an act intended to make it impossible for the IRS to determine their actual tax liability, such as transferring assets and then under-reporting their income. As for an evasion of payment, this can involve such acts as removing assets from traditional bank accounts and placing them in a foreign bank account, which would be out of IRS jurisdiction. Along with this, attempting to conceal assets in another family member’s bank account can qualify as an evasion of payment.
Common Examples of Tax Evasion
Even if a person has errors on their tax return or has taxes that are unpaid, this is not considered tax evasion according to federal law. To be tax evasion, it must be proven a person committed an intentional act to evade assessment or payment. Common examples of tax evasion include:
–Filing a false tax return
–Keeping two sets of books
–Destroying records
–Creating false invoices
If a person has been charged with any of these acts, it will be extremely important to hire the services of a criminal defense attorney who is experienced and knowledgeable in handling IRS tax evasion cases, since the penalties for these crimes can be very severe.
Tax Evasion Penalties
If a person is found guilty of tax evasion, the penalties can include a prison sentence of as much as five years, fines as high as $250,000, and the payment of any taxes that are owed to the IRS. Of all crimes associated with tax evasion, not filing a tax return is considered the least serious regarding penalties. In these situations, civil tax penalties are usually most applicable. However, in extreme cases, a person guilty of this offense may be fined $100,000 for each year a tax return was not filed, and could also face up to 12 months in prison.
Rather than face the prospects of these and other penalties, it is always recommended taxes be paid in a prompt and proper manner. Otherwise, the future could hold a variety of legal consequences.
Roy J. Kahn, with years of legal experience in a wide variety of criminal law, heads a “boutique” firm, which means that your attorney is Roy J. Kahn, not a paralegal. If you have been charged or are about to be charged with a crime—or if you have been contacted to be a witness in a federal grand jury case, you need a qualified defense. You should consult with an attorney immediately and know that you have a right to make no statement until you have consulted with an attorney To contact Mr. Kahn, he can be reached at 305-358-7400.
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