Defenses to Tax Evasion

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What Is Tax Evasion?

Tax evasion is an intentional conduct where a person or a company purposefully underpays taxes or engages in fraud when dealing with taxes.

Mistakes and carelessness is not considered tax evasion. In order to be convicted for tax evasion, the IRS must know that you are intentionally and purposefully trying to underpay your taxes or trying to hide your taxable assets.

What Are Some Examples of Tax Evasion?

Tax evasion usually involves a intentional wrongdoing. Mere negligence or carelessness that causes tax errors is not tax evasion. The IRS usally investigates to determine whether tax evasion has been committed. Some examples of tax fraud includes:

Other possible tax evasion conduct is lying, concealing, or delaying tactics that are designed to mislead the IRS agents in their investigation after you have been red flagged.

What Are Possible Defenses If I Am Accused of Tax Evasion?

Tax evasion is a crime, so all the defenses available for other crimes can be used. Common defenses include: 

What Are The Criminal Penalties For Tax Evasion? 

Since many taxes are considered federal taxes, federal agencies (like the IRS) are commonly in charge of prosecuting tax evasion cases rather than law enforcement. Individual federal law govern each tax evasion offense. Additionally each state might have their own tax evasion laws and penalties.

How Likely Will Any of These Defenses Work?

Tax evasion defenses can be used when there is insufficient evidence of intentional or purposeful conduct. The IRS must prove that the defendant knew their wrongdoing and intentionally misreported their taxes or tried to evade taxes. Mere mistakes and carelessness cannot convict someone with tax evasion. 

Other possible defenses for tax evasion may be that the taxpayer honestly believed that he is not evading or hiding his taxable income because of some misunderstanding of the law. To use this defenses, the taxpayer must show proof of reliance in where they relied on the information such as an accountant or lawyer.

Do I Need an Attorney?

Tax evasion and tax fraud is a very serious matter. If you have been contacted by the IRS for suspicion of tax evasion or fraud or have been charged with a tax evasion crime, you need to speak to a criminal defense attorney. Tax evasion charges must be proved by the IRS and they must provide clear evidence that you knowingly and purposefully tried to evade taxes. A local attorney will be able to assist you on your rights and determine whether you have any valid defenses.

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Last Modified: 02-03-2015 03:49 PM PST

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