Criminal Tax Prosecutions

The most commonly-charged tax offenses are:

  • Tax evasion. 26 USC § 7201.
  • Willful failure to collect or pay over tax. 26 USC § 7202.
  • Willful failure to file a return 26 USC § 7203.
  • Willfully making and subscribing a return, statement, or other document which contains or is verified by written declaration that it is made under penalties of perjury, and which the subscriber does not believe to be true and correct as to every material matter. 26 USC § 7206(1).
  • Knowingly and willfully—
    1. making a materially false, fictitious, or fraudulent statement or representation to a federal agent, or
    2. making or using a false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry.

18 USC § 1001.

  • Conspiracy to commit offense or to defraud the United States. 18 USC § 371.

Tax prosecutions are difficult and expensive. The last thing the government wants to do is prosecute a tax case and lose. So, tax prosecutions are rare indeed.

In my experience, an informant is at the core of every criminal tax case—an insider who has a score to settle with you.

To succeed in a criminal tax prosecution, the government must persuade the jury that it has proved every element of an offense beyond a reasonable doubt.

If you are under investigation for tax evasion, you need sow reasonable doubt in the mind of the investigating government agents.   You need a seasoned criminal tax lawyer on your defense team. Tax laws are complex. Complexity in tax laws undermines proof of the element of willfulness—that the defendant knew and understood the law, and deliberately failed to heed it.

Complexity in the law also undermines the underreporting of tax element of a tax offense.

If you failed to file an income tax return for a year for which you owed a material amount of tax, or if you filed an income tax return materially underreporting your tax, you should correct your reporting as soon as possible. If you have failed to file an income tax return for a year in which you incurred a substantial tax liability, you should file the delinquent tax return(s) as soon as possible. If you have filed a tax return materially underreporting your tax, you should prepare and file an amended tax return correctly reporting your tax liability as soon as possible.

Whatever you do, you should not talk to investigating federal agents. They can and do embellish and misrepresent your statements.

Moreover, you should not be represented by an amateur. The case of Leona Helmsley comes to mind. Ms. Helmsley was famously prosecuted for tax evasion. She was represented by Alan Dershowitz. Dershowitz is a brilliant author, commentator, and Harvard law professor. But he is not a tax attorney. Helmsley was convicted of tax evasion, and imprisoned.

If you are being investigated or prosecuted for tax crimes, you need a seasoned criminal tax attorney on your defense team.