DC Federal Tax Evasion Attorney

Tax evasion is the willful attempt to evade or avoid the payment of any tax. Frequently used methods of tax evasion include under-reporting income and misreporting of deductions. People accused of tax evasion may be targeted because of offshore bank accounts and other financial transactions conducted outside of the U.S. However, that does not mean that those who under-report or fail to file their tax returns can assume they are free of legal complications. If you have been accused of federal tax evasion, you will need to consult with a well-qualified Washington, DC federal tax evasion lawyer. In the meantime, please feel free to refer to the following page as a general guide on the topic of tax evasion and federal charges.

Elements of Federal Tax Evasion

The crime of tax evasion can take many forms, including:

• Social Security Scams
• Inflated charitable contributions
• Filing false income or expense reports
• Filing for false 1099 refunds
• Disguised corporate ownership
• Misuse of trusts

Owners of cash-and-carry businesses can easily run afoul of tax federal tax evasion charges, including owners of restaurants, beauty salons, and small retail stores. The lack of paperwork involved in such businesses makes it easy to under-report income. The U.S. government claims losses of over $300 billion in the most recent tax year; and more than $3 trillion due to tax evasion in the past decade.

Penalties

According to 26 U.S. Code Section 7201, tax evasion is a crime that can result in significant fines, imprisonment, or both. The code states that anyone who willfully attempts to evade or defeat any tax imposed by this title shall be guilty of a felony and, upon conviction, shall be fined no more than $100,000 — or $500,000 in the case of a corporation — imprisoned up to five years, or both. Those found guilty of income tax evasion typically must also pay prosecution costs which is another reason why consulting with a DC federal tax evasion attorney is so important

Burden of Proof

In order to prove an individual charged with tax evasion was guilty of the crime, prosecutors must first establish that the defendant has an unpaid tax liability, meaning they failed to pay the full amount of taxes owed for the year or years in question. The prosecution must also prove that the defendant committed an overt act as an indication of his or her intent to evade paying the actual amount of tax that was owed.

Prosecutors must also clearly establish that the defendant followed through on that attempt and evaded their duty to pay the full amount of tax that was owed. All three elements must be clearly proven beyond a reasonable doubt in order to sustain a conviction. Those involved in criminal enterprises are among the most likely to commit tax evasion. As such, many criminal enterprises – and conspiracies – are unmasked in the process of Internal Revenue Service (IRS) investigations.

One of the most common crimes that accompany tax evasion charges against criminal enterprises is money laundering, [18 U.S. Code Section 1956]. Money laundering is a financial scheme to conceal the identity, source, and destination of illegally-obtained money. The “dirty” money is given to the “launderer,” which can be a bank or some other third party. The launderer then runs it through several transactions in an effort to hide the money’s point of origin. The launderer then returns the “clean” money to the original owner, minus a hefty processing fee.

Tax Evasion Investigations

Tax evasion cases are investigated by the IRS Criminal Investigation Division (CID). In addition to being trained investigators, most of these officers or agents are also certified accountants. They conduct long, comprehensive investigations before determining if a case should be referred for prosecution.

This includes extensive interviews with potential suspects, their family, friends, and business associates. They carefully review a suspect’s financial records in the search for assets, unexplained wealth, and other financial irregularities. Once a CID investigation is complete, the IRS reviews your case before a final decision is made on whether to forward it to the U.S. Department of Justice (DOJ) Tax Division in Washington, DC for prosecution. At the DOJ, an Assistant United States Attorney then reviews the case and makes the final decision to prosecute or decline the case.

This multi-level investigation and review process can work to a defendant’s advantage because there are several opportunities for the defendant’s lawyer to intervene prior to an indictment. At each stage, your lawyer can meet with government attorneys to convince them to decline prosecution or remedy the matter to the satisfaction of the IRS and DOJ to avoid indictment. If you are being investigated for tax evasion or have been federally charged in Washington, DC, it is vital to hire a DC federal tax evasion attorney to protect your rights and represent your interests.