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In an update to a story that we brought to you over the past two years, a Texas attorney has been sentenced in an elaborate offshore tax evasion scheme. This story should serve as a reminder that the IRS has recently enhanced their focus on offshore transactions intended to evade U.S. tax. If you believe that you have utilized an illegal offshore tax strategy, have failed to file a tax return for one or more years, or have taken a position on your tax return that could not be supported upon an examination or investigation, it is in your best interest to contact an experienced tax defense attorney to come into tax compliance.
Defendant Was Sentenced After Being Convicted of Orchestrating an Elaborate Tax Scheme
According to a Department of Justice press release, Jack Stephen Pursley, a Houston, Texas attorney was sentenced to serve 24 months in prison for his role in an offshore tax evasion scheme. Pursley was charged in 2018 and convicted by a federal jury in 2019.
As we explained in our previous story about Pursley’s case, prosecutors alleged that the defendant moved his client/co-conspirator’s millions from the Isle of Man to the United States through a purported purchase of equity in a U.S. entity owned by the co-conspirator and Pursley. This plan would have allowed the tax-free investment of funds into the United States. Prosecutors say that the pair then accessed the funds through transactions classified as interest-free loans and returns of capital. The IRS and Department of Justice have taken the position that their series of transactions was an illegal scheme structured in the manner that it was for the sole purpose of avoiding U.S. taxation.
Pursley personally gained from the transactions that he helped set up. Prosecutors allege that he received over $4.8 million in exchange for his services. Court documents reveal that he was alleged to have spent a part of his cut on a Colorado vacation home, as well as a residence in Houston.
In addition to his two-year federal prison sentence, Pursley was ordered to serve two years of supervised release upon completion of his term of physical incarceration. Pursley was also ordered to pay restitution to the IRS in the amount of approximately $1.7m.
Know When to Contact a Tax Attorney
Whether you have engaged in an elaborate offshore tax scheme like the defendant in the above story or have simply failed to file a tax return, it is in your best interest to clear up any tax noncompliance on your own prior to the IRS or the Department of Justice intervening. Working with an experienced tax defense attorney from the outset, taxpayers have an opportunity to control the narrative and come into compliance on terms that are the most favorable to them.
A seasoned tax attorney will work with you to determine the particular facts and circumstances of your case. After determining the best path to move forward along, your tax lawyer will represent you in any interaction with the IRS. Having to never go up against the IRS alone is one of the biggest benefits of retaining tax counsel.
The voluntary disclosure program allows taxpayers who have committed past tax crimes to be brought back into compliance in almost all cases without facing criminal tax charges. The key is that you must disclose your fraudulent behavior and correct the returns before the IRS opens an audit or a criminal tax investigation into your returns. At the Tax Law Offices of David W. Klasing, our skilled Tax Lawyers and CPAs have years of experience successfully guiding our clients through the voluntary disclosure program and bringing them back into compliance. In fact, at times our voluntary disclosure work has accounted for 80% of our book of business.
Note: As long as a taxpayer that has willfully committed tax crimes (potentially including non-filed returns coupled with affirmative evasion of payment) self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosure before the IRS has started an audit or criminal tax investigation / prosecution, the taxpayer can ordinarily be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously often receive a break on the civil penalties that would otherwise apply.
It is imperative that you hire an experienced and reputable criminal tax defense attorney to take you through the voluntary disclosure process. Only an Attorney has the Attorney Client Privilege and Work Product Privileges that will prevent the very professional that you hire from being potentially being forced to become a witness against you, especially where they prepared the returns that need to be amended, in a subsequent criminal tax audit, investigation or prosecution.
Moreover, only an Attorney can enter you into a voluntary disclosure without engaging in the unauthorized practice of law (a crime in itself). Only an Attorney trained in Criminal Tax Defense fully understands the risks and rewards involved in voluntary disclosures and how to protect you if you do not qualify for a voluntary disclosure.
As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, Kovel CPAs and EAs, our firm provides a one stop shop to efficiently achieve the optimal and predictable results that simultaneously protect your liberty and your net worth. See our Testimonials to see what our clients have to say about us!
We Are Here for You
Regardless of your particular business or estate needs, the professionals at the Tax Law Offices of David W. Klasing are here for you. We are open for business and our team will help ensure that your business is too. Contact the Law Offices of David W. Klasing today to discuss your business with one of our professionals.
In addition to our main office in Irvine, the Tax Law Offices of David W. Klasing has unstaffed (conference room only) satellite offices in Los Angeles, San Bernardino, Santa Barbara, Panorama City, Oxnard, San Diego, Bakersfield, San Jose, San Francisco, Oakland, Carlsbad and Sacramento. During the COVID-19 pandemic, our staff are working from home, but have full virtual meeting capability.
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