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According to a Department of Justice press release, two Nevada men were recently convicted by a federal jury on multiple counts related to conspiring to defraud the IRS and tax evasion. This story should remind taxpayers who have outstanding income tax debt or have failed to file tax returns for one or more years that the potential consequences of an IRS criminal investigation or prosecution can far outweigh the illegal benefits of violating federal tax laws. If you have significant tax debt or have failed to file your tax return for one or more years, you should consider contacting an experienced tax defense attorney to determine the best strategy to come into tax compliance.
Court records reveal that Saud Alessa accumulated more than $500,000 in federal income tax liability for tax years 1998 through 2007. Co-defendant Jeffrey Bowen and Jackie Hayes conspired with Alessa to evade IRS collection of his federal income tax debt. Federal prosecutors detailed to the jury how the co-defendants entered into payment arrangements allowing Alessa's income from his employment to be falsely recorded as commission earned by one of the other co-defendants. Prosecutors alleged that the scheme allowed Alassa's income to go undetected, thereby thwarting IRS collection efforts. To further conceal income earned in this manner, Alessa was alleged to have filed false federal income tax returns in 2012 and 2013. Lastly Alessa filed a false bankruptcy petition in 2013 claiming he had no income.
Alessa and Bowen were found guilty of conspiring to defraud the IRS. In addition, Alessa was convicted of tax evasion and filing false tax returns. Sentencing for the two defendants has been scheduled for early 2022. The three defendants face up to five years in federal prison for the counts related to conspiring to defraud the IRS. Alessa also faces up to five years in federal prison for the tax evasion charge and up to three years in prison for each count of filing a false tax return. Additionally, the defendants may be sentenced to serve a term of supervised release to commence upon the completion of their physical incarceration. Lastly, the defendants will likely be ordered to pay restitution to the IRS representing the amount of tax loss they caused.
Although this story Involves a complicated scheme intended to trick the IRS into believing a taxpayer had no actual income upon which they could recover delinquent tax debt, the threat of IRS investigation or criminal prosecution related to activity intended to avoid the payment of overdue tax is still a very real one. Many taxpayers with delinquent tax debt or unfiled tax returns believe that they are a small fish in a large pond, making the incorrect assumption that they will never be found out. The reality is that over the past few years, the IRS has increased its headcount and more importantly, increased its ability to leverage data analytics to identify and investigate taxpayers who are not in compliance with federal income tax laws.
If you have delinquent tax debt, have failed to file a tax return, or have filed a tax return with knowingly false information, you should consider contacting an experienced tax defense attorney as soon as possible. Together, you will work to determine the pertinent facts of your case and identify areas of civil and criminal risk. Next, you will jointly agree on a path forward, aiming to minimize the potential negative consequences that could come with an IRS examination, investigation, or criminal prosecution. While being represented by a seasoned tax attorney, you won't have to worry about going up against the IRS or Department of Justice alone.
Note: As long as a taxpayer that has willfully committed tax crimes (potentially including non-filed foreign information returns coupled with affirmative evasion of U.S. income tax on offshore income) self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosurebefore 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, KovelCPAs 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!
If you have failed to file a tax return for one or more years or have taken a position on a tax return that could not be supported upon an IRS or state tax authority audit, eggshell audit, reverse eggshell audit, or criminal tax investigation, it is in your best interest to contact an experienced tax defense attorney to determine your best route back into federal or state tax compliance without facing criminal prosecution.
Regardless of your 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.
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