Federal prosecutors recently charged Texas billionaire Robert Brockman with multiple tax crimes. Officials state this is, to date, the largest tax evasion crime the country has seen. Mr. Brockman, arguably one of the nation’s most prominent philanthropists, now faces allegations he intentionally hid over $2 billion in assets using a web of offshore accounts and computer programs to avoid tax obligations.

According to official documents, Mr. Brockman willfully used these methods and intentionally filed false documents with the Internal Revenue Service and Treasury Department to illegally reduce his tax obligations from 2000 through 2015. Official criminal charges currently include tax evasion, failure to file foreign bank account reports, conspiracy, money laundering and destruction of evidence.

Although not everyone can afford to hide billions, the case provides two important lessons to taxpayers throughout the country:

  • Do not try to hide things. One of the issues in this case was the fact that the accused actively attempted to hide things from investigators. The key term here is “willfulness.” A recent post in Forbes notes that Mr. Brockman may have persuaded someone to “alter, destroy or mutilate” evidence connected to the allegations. Feds frown upon such behavior and willful attempts to avoid tax obligations. If allegations like this are supported, the charges can shift from an inadvertent tax mistake to an intentional crime. This shift is an important distinction, as penalties change from potential fees and interest to an increased likelihood of imprisonment.
  • The feds continue to crackdown on foreign accounts. Previous generations may have reduced tax obligations by having accounts in other countries. This is no longer the case. Federal authorities now have the means to find these assets and clearly require reporting for tax purposes. A failure to do so will result in allegations of criminal wrongdoing.

Those who are concerned their assets may not be in full compliance with applicable tax regulations are wise to act to address any potential reporting issues. The attorneys at Goldburd McCone are familiar with reporting requirements and options for compliance. We can review your situation and discuss the pros and cons of each available option.