Tax evasion is the illegal act of avoiding or underpaying taxes. According to the Internal Revenue Service (IRS), tax evasion includes any deliberate attempt to avoid paying taxes, whether through filing a false return, hiding assets, or failing to file a return altogether. Tax evasion is considered a felony and is punishable by up to five years in prison and a fine of up to $250,000 for individuals ($500,000 for corporations).
Types of Tax Evasion
There are two main types of tax evasion: evading assessment and evading payment.
Evading Assessment
Evading assessment occurs when a taxpayer deliberately underreports their income or overstates their deductions in an attempt to reduce their tax liability. Filing a false return is the most common type of evading assessment. For example, if an individual taxpayer claims more deductions than they’re entitled to or omits income from their return, they may be guilty of evading assessment.
One of the best criminal defenses for accusations of evading tax assessment is to argue that the taxpayer was ignorant of the law. This defense is often successful because the law is complicated and it can be difficult for taxpayers to know what is and isn’t allowed. Another common defense is to argue that the taxpayer made a mistake, for example by claiming too many deductions or by reporting incorrect information.
Evading Payment
Evading payment occurs when a taxpayer attempts to avoid paying taxes that they owe by hiding assets or transferring them to someone else. For example, taxpayers who put their money in offshore accounts or fail to report all of their income can be guilty of evading payment.
There are a few criminal defenses that may be available to those accused of evading tax payments. These include arguing that the taxpayer had no intent to evade taxes, claiming that the money was not hidden or transferred with the intent to avoid payment, and asserting that the taxpayer was unaware of their obligations to pay taxes. Additionally, taxpayers may be able to argue that they were victims of mistaken identity or that the evidence against them was obtained illegally.
Of course, in both of these scenarios, we are just speaking of generalities. Each case is unique, and you won’t know the best defense until you can speak to your attorney about the particulars. It’s important that you do, though, because recent legislation out of Washington has given the IRS an infusion of cash in which they plan to go after so-called “tax cheats” more aggressively. It’s best to get your ducks in a row now before the upcoming tax season.
Tax Evasion Is a Serious Matter That Demands the Best Defense Possible
No one likes paying taxes, but tax evasion is not the answer. Not only is it illegal, but it can also result in hefty fines and even jail time. If you’re facing accusations of tax evasion, it’s important to seek legal assistance from a qualified tax defense attorney as soon as possible. An experienced attorney like John R. Teakell will be able to review your case and advise you on the best course of action moving forward.
Throughout his career, Mr. Teakell has been chosen as a Top Rated White Collar Crimes Attorney in Dallas. He was also selected by the Top 100 Lawyers, The National Trial Lawyers: Top 100, and the National Association of Distinguished Counsel, an award reserved for the top 1% of attorneys in the nation. Mr. Teakell is well-equipped to tackle the evidence and help you challenge the evidence head-on. Contact him today to get the best possible defense.