The Internal Revenue Service (IRS) defines tax fraud as an intentional wrongdoing to evade a tax bill. In order to build a case against a taxpayer, the government must generally establish both that there was a tax due and that the taxpayer had the intention of avoiding their obligation to pay that tax bill. As a result, the burden, or obligation, to build the case and prove the crime rests with the government. The old adage innocent until proven guilty is true in tax crime just like it is in any other area of criminal law.
How do these cases work?
They are similar in many ways to other criminal cases. The government will work to gather evidence to support their allegations and then take the alleged offender to court. There, the person accused of the crime will have an opportunity to defend themselves and then the court or a jury will decide their fate.
In a recent case, the feds went after a man out of New York. According to a news release from the Department of Justice, the owner of a construction business that operated in Brooklyn failed to pay payroll taxes to the Internal Revenue Service (IRS). Over five years, the prosecution stated that the business owner concealed cash payments to underreport wages and avoid his obligation to pay payroll taxes. The feds claim this resulted in a failure to pay over $255,000 in Social Security and Medicare taxes.
How serious are the allegations?
We often say that tax crimes come with harsh penalties, so it is important to take the allegations seriously. But sometimes an example is better than just hearing that the consequences can be dire. In this case, the entrepreneur faces up to five years imprisonment as well as required restitution payments and monetary penalties.
Do not let the same thing happen to you. If you or a loved one are operating a business make sure you are in full compliance with applicable tax regulations. If you do face allegations of a tax crime like the one discussed above, take the matter seriously. The attorneys at Goldburd McCone are experienced in these matters and can advocate for your interests, better ensuring a more favorable outcome.