It is possible to get jail time for tax fraud, even when it is charged as a misdemeanor, but in practice, most people sentenced to incarceration for tax-related crimes have been convicted of lying to the IRS about large sums of money.
Even the most honest and the most financially secure people get butterflies in their stomachs around tax time. Filing your tax returns requires you to confront two frightening things that you can usually avoid for the rest of the year, namely math and letting authorities get into your personal financial behaviors. The sight of an income tax form brings back memories of your parents scolding you about being disorganized or an ex-spouse constantly grumbling about your frivolous spending. Making a mistake on your taxes could lead to you having to pay penalties, but you cannot get criminal charges for tax fraud unless you intentionally make false statements on documents you file with the IRS. If you are facing criminal charges for tax fraud, contact an Atlanta tax fraud defense lawyer.
Robbing the Rich to Pay the Poor?
It is not just your imagination that many working people have an unaffordable tax burden. If you think that it is unfair that, even though your income is just a few dollars above the threshold to qualify for a stimulus check, you have to pay 30% of your hard-earned 1099 income to the IRS, you have a point, especially if you know someone who makes most of their money through passive income and still gets a tax refund. In this case, you should work with your accountant to find every possible tax credit and deduction for which you qualify but resist the temptation to bend the truth. The following actions, although it may seem like everyone you know does them, count as tax fraud, which is a criminal misdemeanor punishable by up to a year in jail:
- Underreporting your income
- Misrepresenting personal expenses as business expenses
- Omitting information from your tax return in order to make it impossible for the IRS to know how much you owe (known as filing a frivolous return)
Not everyone who gets in trouble with the IRS goes to jail, but you will always end up having to pay more than if you had been truthful on your tax returns. If you get criminal charges for tax fraud, one possible defense is that the incorrect information on your tax forms was the result of an unintentional mistake. Another possible defense is that your tax preparer lied on your tax forms without your knowledge.
When is Lying to the IRS a Felony?
In some cases, the authorities prosecute tax fraud as a federal crime, meaning that the defendant allegedly defrauded the federal government. In this case, tax fraud is a felony, with a maximum sentence of five years in prison. Likewise, if you get convicted of tax fraud along with other financial crimes such as money laundering, you can get a prison sentence.
A Defense Lawyer Can Help You Straighten Out Your Tax Fraud Charges
Tax mistakes and confusion are common; a criminal defense lawyer can help you demonstrate that you did not intentionally defraud the IRS. Contact the defense lawyers at Ghanayem & Rayasam in Atlanta, Georgia about your tax fraud case.