Without knowing more about your specific facts and circumstances, this question cannot be answered. However, IRC Section 7201 finds a person liable for tax evasion when he “willfully attempts in any manner to evade or defeat any tax.” An attempt to evade taxes exists when one (1) fails to file a tax return and (2) engages in an affirmative act to evade or defeat the assessment of a tax.

Furthermore, case law has held that a taxpayer makes such an affirmative action when he files a false W-4 and later fails to file his income tax return. See, e.g., United States v. Brooks, 174 F.3d 950, 954-56 (8th Cir. 1999). For example, if a taxpayer files a W-4 Form, falsely claiming that he is tax exempt in Year 1, and several years later he fails to file his income return, he commits tax evasion because he made an affirmative act to defeat a tax. See United States v. King, 126 F.3d 987, 991-94 (7th Cir. 1997), where the taxpayer committed Spies evasion. There, the taxpayer failed to file a return. Taken alone, that would not have risen to the level of a felony. However, he was found liable because his action was coupled with his prior acts of filing a W-4 where he falsely claimed to be exempt from income tax—actions which taken together, constituted an “affirmative act” to evade taxes. Interestingly, the old W-4s relied upon by the prosecution in establishing Spies evasion had already expired for the tax year at issue but they were still evidentially sufficient to find that the taxpayer had committed an affirmative act by their prior use.

September 5, 2014

Is it tax evasion if my W-4 contains false statements?

Without knowing more about your specific facts and circumstances, this question cannot be answered. However, IRC Section 7201 finds a person liable for tax evasion when […]
August 12, 2014

IRC §7201 attempt to evade vs. common-law crime of attempt

No, IRC Section 7201’s definition of “attempt to evade” is materially different from “attempt” crime of common-law. This was one of the holdings of the Supreme […]
April 8, 2014

What is a tax that was “due and owing.”

Like almost all areas of law, especially tax law, there are nuances and exceptions. The government must prove beyond a reasonable doubt three basic things to […]
March 27, 2014

What are the common issues that non-filers face?

Each year the IRS receives more than 150 million tax returns filed by individuals and businesses. But despite the nearly universal obligation to file taxes due […]
March 21, 2014

CPA aiding or assisting the filing of a false return

Generally, this statute does not apply just to tax preparers but anyone who causes a false return to be filed. Accordingly, the CPA should be aware […]
March 21, 2014

Defenses for tax crimes of a taxpayer or tax preparer

Willfulness is defined under the law as a voluntary and intentional violation of a known legal duty and several defenses focus on preventing the government from […]