Tax fraud crimes in Dallas include some forms of tax evasion. Learn the distinctions between these two offenses.
Public perception of tax fraud crimes is impacted by the fact that many people view this as a victimless crime.
After all, many people hate paying taxes, so the idea that someone tried to get away with not paying the government doesn’t generate a lot of attention.
However, federal prosecutors do take these crimes very seriously, and convictions for white-collar offenses can result in lengthy prison sentences, depending on the severity of the crime and the amount of money involved.
Tax fraud and tax evasion are two of the most common types of white-collar crimes, but they are often used interchangeably when in fact, tax evasion is a subset of tax fraud.
What Is Tax Fraud?
When we hear that people were convicted of tax fraud, we assume they cheated on their taxes, but what is tax fraud in legal terms and why is it such a serious crime?
Tax fraud refers to an intentional attempt by a person to defraud the Internal Revenue Service. The legal definition of ‘fraud’ is an intentional act to deceive another person or entity for profit, money or personal gain.
Therefore, a person that tries to deceive the IRS for personal gain can be charged with tax fraud as long as prosecutors can prove that the person intentionally or knowingly acted with the sole purpose of deceiving the agency.
Some common examples of tax fraud include:
- Intentionally failing to file a tax return – a person that knows that taxes are due, but intentionally fails to file them in order to profit or gain can be charged with tax fraud.
- Making false claims on a tax return – a person that lies about deductions and other tax-related matters to profit from that deception is guilty of tax fraud.
- Filing a false return – a person that knowingly submits a tax return that has false or misleading information on it to profit or gain from that return is guilty of tax fraud.
The key aspect of tax fraud is that the person accused of the crime knowingly and intentionally chose to deceive, misrepresent or mislead the IRS to profit from that deception.
What Is Tax Evasion?
Tax evasion is very similar to tax fraud, but it refers to activities such as the nonpayment of taxes owed, or the underpayment of taxes by failing to report income.
It also includes reporting expenses that are not legal or failing to pay taxes that are owed to the IRS.
Employers are also guilty of tax evasion if they pay employees in cash in order to evade having to pay payroll taxes and other federal taxes to the IRS.
The key to this charge is that the defendant sought to evade a financial responsibility to the IRS through specific activities.
Proving Tax Fraud
Despite its vast resources, the IRS finds that proving tax fraud can be very difficult because without compelling, direct evidence, defendants can argue that while they are guilty of negligence, they didn’t intentionally attempt to defraud the government.
As a result, the IRS often goes after defendants in civil court by collecting tax money that is past due.
This is an easier case for the IRS to win because it doesn’t have to prove that the defendant acted with criminal intent to defraud, it simply has to show that the defendant didn’t pay all the taxes due on their income.
However, the IRS will pursue a criminal conviction for tax fraud cases that are tied to an ongoing criminal enterprise.
For example, the IRS recently helped prosecute the masterminds behind an organization that stole personal information from more than 259,000 people and used that information to obtain electronic filing PINs from the IRS, so they could steal tax refund checks¹
Attorneys for Tax Fraud Crimes in Dallas
People that are arrested for tax-related offenses must secure the services of attorneys for tax fraud crimes in Dallas.
Making the assumption that the IRS will not choose to file criminal charges is dangerous because depending on the amount of money owed, the agency may decide that it wants to make an example out of a specific defendant.
Experienced white-collar attorneys can analyze every aspect of a tax fraud or tax evasion case to find weaknesses or areas where prosecutors lack sufficient evidence to pursue a criminal trial.
Broden & Mickelsen
Dallas Best Criminal Defense Lawyers
Prior results cannot and do not guarantee or predict a similar outcome with respect to any future case.