According to a Department of Justice press release, a New Jersey man was recently sentenced to federal prison for his role in a tax fraud conspiracy. Although many taxpayers believe that their omissions of income or over statement of deductions or calcimining credits on their tax return are just a small part of a single return in a country of hundreds of millions of tax returns, the civil and criminal repercussions for tax fraud and evasion are severe enough to warrant any such taxpayer to take pause. 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 audit or criminal tax investigation, it is in your best interest to seek the assistance of an experienced tax defense attorney.
Defendant Duped Taxpayers into Fake Mortgage Payment Scheme
In an update to news that we brought to you in a blog post earlier this year, Kenneth Crawford Jr. was sentenced to serve 78 months in prison for his role in a tax fraud scheme. Consistent with our prior reporting on this story, Crawford and several co-conspirators worked together as part of a tax refund scheme that was marketed to individuals who were struggling to make or were behind on their mortgage payments.
As a part of the scam, Crawford and his co-conspirators provided clients with false IRS forms that they purported would result in the IRS sending large refund payments that were intended to pay off the mortgages of the clients. The forms that Crawford and his associates filed claimed that the clients had significantly over withheld and that large refunds were due. According to IRS Criminal Investigations, over $2.5 million in refunds were claimed and more than $1.3 million were actually paid before the IRS realized that there was something fishy afoot. Crawford and his co-conspirators typically kept 25 percent of any refunds received for clients.
Upon discovery of the scheme, the IRS quickly began collection efforts to recover the improperly disbursed refunds. Crawford instructed clients to move money out of their personal bank accounts, avoid discussing the matter with the IRS, and to file fictitious paperwork with the IRS that would further thwart their recovery efforts. Additionally, Crawford instructed clients to minimize his and his associates’ roles in the refund claim process.
In addition to being sentenced to a significant amount of time in federal prison, Crawford was ordered to serve three years of supervised release upon the completion of his physical incarceration. Additionally, he was ordered to pay over $1.3 million in restitution, representing the amount of tax loss to the government.
Understanding Your Criminal and Civil Tax Exposure
The defendant’s fact pattern above seems dramatic, but at the end of the day, Americans who either claim tax credits that they are not entitled to or otherwise lie on their tax return run the risk of facing the same type of civil and criminal tax consequences. As the IRS increases their ability to identify and single out those who have been dishonest on their tax returns, the likelihood that a taxpayer with a tax exposure will be discovered and be required to face the consequences.
Luckily for taxpayers, the IRS has several programs, an experienced tax attorney have various methods, to bring taxpayers into compliance with the country’s tax laws. Getting right with the government does not need to be an arduous process. In fact, when you seek the assistance of an experienced tax defense lawyer, you will be represented with all interactions with the IRS or state taxing authority. This means that you will never need to fight the government alone.
We Are Here for You
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.
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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Questions and Answers for Criminal Tax Representation
- When tax defense counsel parallels tax crime investigation
- Guilty of tax obstruction by backdating documents?
- To be found guilty of tax obstruction must a person actually be successful in impeding the IRS’s functions?
- Help! The Document I Gave the IRS Had False Information
- Tax crime aiding or assisting false return IRC §7206(2)
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- Increased possibility of civil action in IRS investigation
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- What the IRS includes in indictment for tax case
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- IRS methods of gathering evidence to prove tax crime
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- Failure to keep records or supply information
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- Does overstating deductions constitute tax evasion?
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