Investigations for criminal tax evasion have been on the rise in North Carolina and around the United States. At Arnold & Smith, PLLC our experienced state and federal criminal tax fraud defense attorneys have the experience and training necessary to fight assertively for our clients. Our lawyers understand that facing tax fraud charges can be particularly stressful and onerous. What is the tax fraud charge process? How can individuals best defend themselves when facing criminal tax fraud charges?
What is Tax Fraud?According to the Internal Revenue Service (IRS), tax fraud occurs when the taxpayer misrepresents material facts to deceive the IRS. Tax fraud also includes silence. For example, when acting in good faith would require telling the IRS about income and the taxpayer remains silent, he or she could be engaging in tax fraud. The misrepresentation or silence must result in material damage to the person who has a right to rely on the information.
More narrowly, tax fraud occurs when the taxpayer intentionally engages in wrongdoing. The taxpayer must have the intention to evade a tax that he or she knows or believes that she owes the IRS. In order to convict a taxpayer of tax fraud, the federal prosecutor must prove the following two elements:
The federal government, specifically the IRS carries the burden of proof. The government has the obligation to prove to a judge or jury that the taxpayer engaged in tax fraud by submitting evidence that supports a conviction. The government can provide the following types of evidence:
When trying a taxpayer for criminal tax fraud, the government must prove that the taxpayer is guilty beyond a reasonable doubt. In civil tax fraud cases, the government only needs to prove that fraud occurred by clear and convincing evidence. The penalties for criminal tax fraud vary, depending on the specific type of fraud committed. Federal tax law recognizes several different types of tax fraud, to include the following:
Those convicted of criminal tax fraud face serious penalties, including prison time and serious fines. The prosecution has a right to enforce criminal penalties, and the purpose of the penalties is to punish the taxpayer and deter other taxpayers from engaging in fraud.
What are the Indicators that Fraud Took Place?The IRS does have a history of accusing innocent taxpayers of committing criminal tax fraud. Sometimes innocent circumstances trigger an investigation by the IRS, leading them to assume that criminal tax fraud has taken place. The following circumstances are a red flag to the IRS for potential tax fraud:
In order to meet the burden of proof, the government must prove that the taxpayer engaged in an affirmative act of fraud. Affirmative acts of criminal tax fraud can include the following actions:
At Arnold & Smith, PLLC our tax fraud defense lawyers provide the guidance that our clients need. As soon as you are served with a Federal Grand Jury Subpoena, an IRS summons for documents, or you receive a visit from a special IRS agent, we recommend contacting our law firm. It is important that you refrain from voluntarily giving the IRS a statement until you receive advice from a skilled attorney. The IRS can and will use your statement against you should your case proceed to trial.
We create a comprehensive criminal defense strategy for our clients. Our strategy often includes working with forensic accountants and other experts and professionals from within the field. Using all of the tools at our disposal, we put together a comprehensive defense for our clients. Contact our law firm or call 704-370-2828 today to schedule your free initial consultation. We now provide three convenient locations to meet in Uptown Charlotte, Monroe and Mooresville.