In the United States, every citizen needs to contend with paying their fair share of taxes, but if the U.S. Internal Revenue Service (IRS) believes you knowingly and willfully lied on your tax forms to avoid paying taxes, then you can be charged with tax fraud, which is a serious federal crime. When you are charged at the federal level, you can face a felony conviction leading to years in prison and significant fines. A criminal record that includes a conviction for tax evasion also makes it difficult to obtain a good job once you complete your sentence. It may even bar you from obtaining certain professional licenses or positions entirely.
If the IRS claims you intentionally lied to pay fewer or no taxes, then you should call experienced Houston tax fraud attorney Ned Barnett immediately. Simple mistakes on your tax forms can lead the IRS to believe you are trying to deceive them. Let federal attorney Ned Barnett defend you in court to reduce the likelihood of a conviction and harsh punishments.
Call (713) 222-6767 for a free and confidential consultation to discuss your situation.
Federal Tax Fraud Crimes
Tax fraud can arise through many different actions; however, any instance of tax fraud involves intentionally trying to deceive the IRS in an effort to reduce your tax liability. Both individuals and corporations can be guilty of tax fraud. If a corporation is found guilty of one of the following provisions, it will be fined a higher amount.
The federal tax code lays out numerous tax fraud offenses, including:
- Attempt to evade or defeat taxes. Title 26 USC §7201 states that any person who willfully tries to evade or defeat any tax imposed by the IRS or payment of that tax is guilty of a felony, punishable by up to 5 years in prison and a fine up to $250,000.
- Willful failure to collect or pay over tax. According to Title 26 USC §7202, any person who is required to collect, account for and pay over any tax imposed by the law and who intentionally fails to collect or truthfully account for and pay over such tax is guilty of a felony. This person can be imprisoned for up to 5 years and fined up to $250,000.
- Willful failure to file tax returns, supply information, or pay tax. Title 26 USC §7203 states that any person required to pay any tax or estimated tax, or required to make a return, keep records, or supply any information, and who willfully fails to do so by the time the law requires shall be guilty of a misdemeanor, punishable by up to 1 year in prison and a fine up to $100,000.
- Fraudulent withholding exemption certificate or failure to supply information. According to Title 26 USC §7205(a), any individual required to supply information to his or her employer but who willfully provides false or fraudulent information, or who intentionally fails to supply information that requires an increase in taxes withheld, shall be imprisoned for up to 1 year and fined up to $1,000. If any individual purposefully makes a false certificate required by this code, then he or she can be imprisoned up to 1 year and fined up to $1,000.
- Fraud or false statements. Under Title 26 USC §7206 (1), any person who willfully makes and subscribes any return, statement or document, which is verified by a written declaration made under penalties of perjury, and does who so not believing the document to be true and correct in all material matters is guilty of a felony. Title 26 USC §7206 (2) states any person who intentionally aids or assists in the creation or preparation of a document that is false or contains fraudulent material matter is guilty of a felony. Both of these crimes can result in imprisonment up to 3 years and a fine up to $250,000.
- Fraudulent returns, statements, or other documents. Title 26 USC §7207 states anyone who willfully delivers or discloses to the Secretary, any list, return, account, statement or other document known to him or her as fraudulent or to include false material matter will be fined up to $10,000 and imprisoned up to 1 year.
- Conspiracy to commit offense or to defraud the United States. Under Title 18 USC §371, if two or more people conspire to commit an offense against the U.S. or defraud the U.S. or any of its agencies, or one or more persons within the conspiracy do any act to forward the purpose of the conspiracy, shall each be imprisoned for up to 5 years and fined up to $250,000.
Collateral Consequences of a Federal Tax Fraud Conviction
You face serious collateral penalties if you are convicted of federal tax fraud. If you are an attorney, accountant or hold another professional license, you may lose your license and ability to practice. If you aspired to one of these professions, the governing body for your state may deny you entry perpetually or for a period of time.
Outside of a specific professional license, you may still lose the ability to take on certain positions or roles. Future employers will see a tax fraud conviction and may find you unfit for a position that requires a great deal of responsibility or is related to the company’s finances.
Other consequences associated with a felony conviction include:
- Loss of voting rights
- Firearm ownership restrictions
- Inability to receive federal student aid
- Difficulty obtaining private financial aid
- Difficulty obtaining adequate housing
- Loss of child custody or visitation
- Change in immigration status or deportation
Defending Against Tax Fraud Charges With the Help of a Houston Tax Fraud Attorney
If you have been charged with federal tax fraud, you need an experienced criminal defense attorney like Ned Barnett who understands the complexity of the U.S. tax code. It is all too easy to make a mistake on your personal or business taxes because you filled out the forms yourself or have little to no help keeping your business’s books. Confusion regarding which forms you need to fill out and additional information you must provide can make it look like you are hiding something when you simply misunderstood or entered a wrong number.
Attorney Barnett brings both prosecutorial and defense experience to your case with more than 30 years of practice in Texas and has worked extensively on a variety of tax fraud cases.