An overwhelming tax debt could be hard to resolve, especially when you have accrued this debt over the years. Failing to do so could lead to serious legal consequences, at the state and federal levels. Sometimes tax evasion charges occur due to a mistake, such as a clerical error, or a simple misunderstanding. Regardless of why you have been charged with tax evasion, you will need an experienced attorney who can help you build a strong tax evasion defense, as quickly as possible. The law office of John R. Teakell is the legal firm for you. When you hire our office, you will have access to an experienced team of legal professionals who are highly qualified to take on various aspects of the law, including tax evasion.
What is Tax Evasion?
If you fail to pay your taxes, this can be considered tax evasion if you did so knowingly. It is illegal to avoid paying your taxes. If you file your taxes, but file a fraudulent tax return, this is also considered tax evasion, which is a felony, and if you are convicted of this crime, you could face time in prison, in addition to fines. A corporation convicted of tax evasion could pay up to $500,000 in fines, while an individual convicted of the same crime could pay up to $100,000 – the penalties will depend on the tax amount, and if you are being charged on the state or federal level.
There is a difference between tax avoidance and tax evasion. The former occurs when you use legal methods to reduce or avoid tax payments; those legal methods include finding tax shelters or loopholes. Tax evasion is when you use illegal methods to avoid paying your taxes – or seeking reduced payment amounts.
Making a mistake is not punishable by the law if you can prove that you did in fact make an error. If this is the case, you will be required to pay the amount that you should have paid, in addition to another small fee – the fee and its amount will vary. You will not be convicted of tax evasion and sentenced to prison if you can prove that an error or mistake was made, and you could also avoid the penalties associated with a criminal trial.
If you are charged with tax evasion, you could face serious legal penalties, on both the criminal and civil level. Regardless if you are charged with state or federal tax evasion, the court must prove that criminal intent was shown. With so many tax rules, a simple mistake could happen, which is where an attorney could defend you by proving that the intent to commit fraud was never your plan.
Federal Tax Evasion
If the Internal Revenue Service (IRS) can show that you have deliberately attempted to underpay your taxes, you will be charged with a federal crime: tax evasion. Failing to file your tax return prevents the IRS from auditing you, or your company’s, finances. The most common example of tax evasion is underreporting income. Most individuals or businesses that are charged – and convicted of – federal tax evasion deal largely in cash, such as retail store owners, waiting staff, or beauticians (and those in the cosmetology field); however, some corporations charged with federal tax evasion report fraudulent records of their finances. Businesses have been known to inflate their expenses, while individuals overstate the size of their families in order to qualify for larger deductions.
If the IRS suspects a business or individual of committing these crimes, it will begin an investigation, which could lead to prosecution.
State Tax Evasion
Texas does not require you to pay local taxes; therefore, the main source of state revenue comes from sales tax, which is why tax evasion is a serious charge, especially for businesses in Texas who fail to pay taxes – or those who commit fraud. You must keep accurate records of your sales. Using electronic devices to falsify your records is also illegal.
Hiring an attorney with experience in state revenue gives you an added bonus. The attorney could help you find the loopholes in state law. If you are convicted of state tax evasion, you not only face jail time and a fine, but as a corporation, your sales tax permit could be suspended. In some instances, your sales tax permit could be revoked, and the state comptroller will deny any future permits.
Get the Legal Help You Need
Waiting is never a good option, especially with tax evasion charges. You want to build a strong case immediately, so you can handle the situation and avoid any jail time or costly penalties and fines. The sooner you give the law office of John R. Teakell a call, the sooner we can begin building a strong tax evasion defense for you.
Contact us today and get the legal representation you deserve!