Criminal Tax Offenses: What Kind of Lawyer Do I Need?

Criminal tax cases are relatively common in the United States. In 2021 alone, over 57K cases were reported to the U.S. Sentencing Commission (USCC). Of those cases, 96.2% were committed by United States citizens with little to no prior criminal history. These cases are particularly interesting because of the offender characteristics (primarily white men over 50 years of age) and because criminal tax charges rarely appear in isolation. In many cases, there are multiple governmental agencies investigating the charges in addition to parallel civil proceedings. Hiring a highly experienced criminal tax attorney to aid in an effective defense is necessary if you are faced with pending criminal tax charges. 

Common Federal Tax Crimes

Few things are as certain as death and taxes. While many U.S. citizens do what they can to legally reduce their tax liability, there are always those who will try to avoid paying taxes. If you engage in illegal activities to avoid paying your taxes, the Internal Revenue Service (IRS) will not only charge you criminally for tax evasion, but you may face a series of civil offenses once your criminal prosecution is complete. The two most common types of violations of the Internal Revenue Code are tax evasion and tax fraud. While these terms are often used interchangeably, there are important distinctions between the two. 

Tax evasion

Tax evasion is a serious crime with significant repercussions. Tax evasion is when someone willfully misleads the IRS to avoid paying taxes or takes illegal actions to avoid paying taxes. Tax evasion requires the intent to evade tax and an affirmative act. In these cases, there are three elements of tax evasion that must be proved beyond a reasonable doubt: 

• An attempt to evade or defeat a tax or the payment of a tax 

• An additional tax due and owing 

• Willfulness 

Failure to file taxes is one of the surest ways to land you in hot water with the IRS. Refusing to file a tax return has a steep punishment of one year in prison for every year not filed, with a maximum of up to six years. According to the IRS, passive failure to file tax returns is not considered tax evasion. An evasion case must prove that the taxpayer engaged in an intentional act to conceal or mislead (Spies v. United States). Affirmative acts are deliberate actions meant to conceal financial information. For example, consistent patterns of overstating deductions, concealment of bank accounts, and representing political gratuities as gifts are all considered affirmative acts of concealment by the U.S. government. 

Tax fraud

Tax fraud can be both a civil and criminal tax violation. Although tax fraud does not have the same requirements as tax evasion and can come in many forms, civil tax fraud can originate from intentional omission or intentional misrepresentation. The IRS requires clear and convincing evidence to prove that some part of the underpayment of tax was due to fraud. This evidence must show that the taxpayer intentionally evaded the assessment of tax, which the taxpayer believed they owed. 

Criminal tax fraud is slightly different from civil tax fraud. Intentionally leaving information from a tax assessment can elevate a civil tax fraud case to a criminal case. An example of criminal tax fraud would be if someone fails to report foreign income on a U.S. tax return. 

Common Examples of Tax Evasion

There are two main types of tax evasion, but a broad number of actions can fall into these categories. The following are some common examples of tax evasion:

• Underreporting income.

• Exaggerating tax deductions.

• Claiming credits you’re not legally supposed to claim. 

• Making up dependents and putting them on your return.

• Transferring assets to others to avoid paying tax.

• Hiding income or assets to reduce your tax bill.

• Holding property in someone else’s name.

• Hiding sources of income.

• Destroying tax records.

• Filing a false tax return.

• Maintaining a double set of books for your business. 

What Kind of Lawyer Do I Need for Tax Evasion?

If you are a target of an IRS criminal investigation, receive a court summons, or suspect that you may be under investigation for tax crimes, you should seek the advice of a criminal tax attorney as soon as possible. It's essential to have a lawyer who has expertise in both criminal and civil legal procedures to handle tax offenses. A licensed tax attorney will prepare a rigorous defense to give you the best shot at defending your claim and limiting the legal repercussions. To find a skilled local tax attorney who's already been vetted by the Expertise team, use the search tool here. 

Can you go to jail for tax evasion?

If you are found guilty of federal tax evasion, there is a distinct possibility you may face jail time. While the IRS does not pursue many criminal tax evasion cases, the penalty for those who are caught is harsh. To rectify the charges, the taxpayer must repay the taxes in addition to a steep fraud penalty. Anyone found convicted of federal tax fraud can spend up to five years in jail. Speak with your attorney to discuss the intricacies of your case and determine the likelihood of jail time and potential fines. 

What Kind of Lawyer Do I Need for Tax Fraud?

An experienced tax attorney with a background in IRS investigations and tax law is essential when dealing with fraud charges. There are many online resources to find legal counsel, but due to the seriousness of tax fraud cases, make sure to ask your attorney about their specific credentials. If you are dealing with a complex tax fraud case, it is highly recommended that you seek the assistance of an experienced tax attorney who has a Juris Doctor degree. Many specialists will have additional training in taxation or accounting, which may be useful for your case. If you are involved in a complicated case of tax fraud, it is important to hire a tax attorney who has additional training and experience dealing with the Internal Revenue Service.

How To Find a Tax Attorney

At Expertise.com, we vet our attorneys so you can rest easy knowing you are hiring the best legal counsel. To start your search for a legal representative in your area, you can use Expertise.com’s legal directory of qualified tax attorneys. Another option is to ask other legal professionals that you trust for recommendations for a tax attorney. You can ask an attorney you’ve worked with on prior matters for a referral. If this is not an option, check your local bar association for specialists in your area.