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According to a Department of Justice press release, a Guilford, Vermont business owner was recently sentenced to time served after pleading guilty to tax evasion stemming from underreporting of income on his filed tax returns. As tax season approaches, it is critical for taxpayers to appreciate the severity and potential consequences of intentionally underreporting your income or fraudulently inflating your deductions. If you have failed to file a tax return for one or more years, or have taken a position on a filed tax return that could not be supported upon an IRS or state examination, you should consider seeking the assistance of dually licensed criminal tax defense attorney and CPA.
Court records reveal that between 2014 and 2018, Christopher Parker earned substantial revenue from operating his own business. During that time, Parker intentionally misled his paid tax preparer by providing him with documentation alleging he earned substantially less from his business than he did. During that period, Parker earned at least $3.35 million, but only reported $2.5 million on his combined tax returns for those periods. Parker’s illegal activity caused a federal tax loss of more than $281,000.
Parker was arrested upon being charged with tax evasion and thus, was sentenced to time he had already served. In addition, Parker was sentenced to three years of supervised release. He will also be required to perform 200 hours of community service. Prior to sentencing, Parker repaid $281,000 to the IRS, representing the tax loss that he caused.
Underreporting income or overstating deductions can be incredibly tempting. Some taxpayers view this tactic as an effective way to manage their tax bill at the end of each year. Unfortunately for them, it comes at an extreme risk. The IRS employs complex detection technology to help catch those who have cheated on their taxes. Additionally, the past year has seen the hiring of hundreds of new IRS agents who will focus primarily on new individual and business audits. These increased efforts by the IRS only mean one thing for those who have been dishonest on their taxes in the past: a higher probability of being caught.
Luckily, there are methods to come back into compliance without risk of criminal tax prosecution before the IRS initiates an audit or a criminal tax investigation. If you have failed to file a tax return for one or more years, have understated income, claimed credits for which you were not entitled or fraudulently overstated deductions, it is in your best interest to consult with an experienced dually licensed Criminal Tax Defense Attorney & CPA. Together with your seasoned tax lawyer, you will establish the relevant facts of your case, determine the best strategy to get right with the government, and implement that strategy. Best of all, you will never have to go up against the IRS 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!
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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