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Tax Fraud

Tax evasion, or tax fraud, refers to criminally avoiding or falsifying tax documents to defraud the United States Internal Revenue Service (IRS). When many hear about tax fraud, they associate the crime with big name celebrities who have been convicted of the charge, such as Al Capone, Wesley Snipes, and Willie Nelson. In reality, anyone can be charged or investigated for tax fraud. Miami and Florida residents facing charges should act quickly by calling an experienced white collar criminal defense attorney.

According to the IRS, there have been almost 5,000 investigations of tax crimes in the last three years. Tax evasion convictions are trending downward, in 2020 there were a mere 593 convictions in the US. If you are one of the few individuals unlucky enough to be investigated for tax fraud, contact a Miami tax attorney as soon as possible to protect yourself.

What is Tax Fraud?

Most of us use methods approved by state and federal governments to pay as little taxes as possible, tax fraud occurs when an individual steps over the line and begins purposefully misrepresents tax documents to avoid taxes. Tax evasion could take the form of: understating assets and income, failing to file tax returns, overstating deductions, the use of offshore corporations to offset taxes, and more.

Tax Fraud Penalties

To begin, if you are convicted of tax evasion, you are required to pay the entirety of the taxes you evaded. Tax evasion can be a misdemeanor or felony, punishments vary greatly depending on the dollar amount at issue.

If the amount of taxes evaded is between $301 and $20,000, the conviction is a third-degree felony and punishable by up to five years in prison and a $5,000 fine.

If the amount evaded is between $20,001 and $100,000, the conviction is a second-degree felony and punishable by up to fifteen years in prison and a $10,000 fine.

Finally, if the defendant evades over $100,000 in taxes, they are guilty of a first-degree felony, facing up to thirty years in prison and $10,000 in fines.

Similarly, those facing federal tax evasion charges are up against serious penalties. Under IRC § 7201, any person who willfully evades taxes can be convicted of a felony, with penalties of up to $100,000 in fines, five years in prison, and prosecution costs.

Fighting Back Against Tax Fraud Charges

Going up against the IRS is formidable, an experienced Miami white collar attorney could have a significant impact on the outcome of your case. An attorney can raise any number of pretrial motions on your behalf. Common defenses to tax evasion include:

  • Negligence - The IRS has a difficult burden to overcome, they must show that the defendant purposefully evaded taxes, rather than accidentally. If you can prove that your failure to pay taxes was a result of your negligence or forgetfulness, that may be enough to have your case dismissed. This defense could also apply if you are mistaken about when taxes are due or what needs to be reported.
  • Statute of Limitations - There is a time limit for the government to file tax fraud charges. Once the time limit has passed, charges cannot be filed. Generally, the time limit in Florida is three years.
  • You Paid Enough Taxes - Even if you intentionally underreported your assets or income, you may still be able to defend yourself by showing your expenses reduced your liabilities.

A Miami white collar criminal attorney can raise these cases and more, according to the facts of your case.

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