Source: http://www.bestdefender.com/taxevasion-crimes-attorney.html
Timestamp: 2017-08-17 19:10:33
Document Index: 181917420

Matched Legal Cases: ['§ 7201', '§ 7201', '§ 1101', '§ 7202', '§ 7203', '§ 6050', '§ 6654', '§ 7206', '§ 7206', '§ 7206', '§ 7206', '§ 6331', '§ 7206', '§ 7122', '§ 7121', '§ 7206', '§ 7206', '§ 7201', '§ 7205']

The IRS is the only federal agency that can investigate potential criminal violations of the Internal Revenue Code. IRS, Criminal Investigation (CI) At-a-Glance,
The Criminal Investigation Division [hereinafter CID, as it is known in Federal defense circles] is comprised of approximately 4,400 employees worldwide. Id. In the period spanning October 1, 2004 through June 30, 2005, CID had initiated over 3000 investigations, secured over 1800 indictments, and won convictions in over 1600 of those cases. IRD, Current Fiscal Year Investigations, available here (Last Visited March 7, 2008). 84.1% of those convicted went to prison and served an average of 44 months there. Id. Obviously, then, the IRS takes attempts to evade the tax laws of the United States very seriously. The CID has the ability to investigate more crimes than mere tax crimes, such as money laundering and bank fraud. CI At-a-Glance. However, for the purposes of this page, only the crimes listed in 26 U.S.C. § 7201 (2007) et seq. will be considered.
26 U.S.C. § 7201 (2007).
The CrimeUnder section 7201, it is a crime for a person to
The Punishment Violating section 7201 will constitute a felony, and the punishment for doing so is
a fine of not more than $100,000 ($500,000 in the case of a corporation),
Case Law Interpreting Section 7201 Tax evasion requires some overt, affirmative act that would constitute an evasion or attempted evasion of tax. See Sansone v. United States, 380 U.S. 343, 351 (1965); Spies v. United States, 317 U.S. 492, 498-99 (1943) (also holding that mere omission is insufficient to sustain a conviction under section 7201. Stated a different way, the felonious conduct proscribed by section 7201 has two elements: 1) a particular subjective state of mind, and 2) certain affirmative activity carried on pursuant to that mental state. Wilson v. United States, 250 F.2d 312, 318 (9th Cir. 1957). Building off of Sansone, the Second Circuit feels that there are four offenses in section 7201: "(1) 'evading ¼ a[] tax'; (2) defeating a[] tax'; (3) 'evading ¼ the payment thereof'; and (4) 'defeating ¼ the payment thereof.'" Evangelista v. Ashcroft, 359 F.3d 145, 151 (2d Cir. 2004) (brackets in original) cert. denied 543 U.S. 1145 (2005).
A violation of section 7201 can be considered an "aggravated felony" under 8 U.S.C. § 1101(a)(43)(M)(ii) which allows aliens to be deported because section 7201 includes the offense of willfully attempting to evade or defeat the assessment of a tax as well as a willing attempt to evade or defeat the payment of the tax. Evangelista at 151.
There are a number of actions that a defendant may take that might constitute an offense. Among them are:
filing a false or fraudulent return; see United States v. Schafer, 580 F.2d 774, 782 (5th Cir. 1978);
taking fraudulent deductions; see United States v. Ragen, 314 U.S. 513, 524 (1942) (interpreting predecessor statute);
failure to report income from criminal activity; see United States v. Milder, 459 F.2d 801, 802, 804 (8th Cir. 1972);
improper accounting; see United States v. Walker, 896 F.2d 295, 300 (8th Cir. 1990);
26 U.S.C. § 7202 (2007).
The Crime Under section 7202, it is a crime for a person who is required under this title to collect, account for, and pay over any tax imposed by this title
to willfully fail to
truthfully account for and pay over
The Punishment Violating section 7202 will constitute a felony, and the punishment for doing so is
a fine of not more than $10,000,
Case Law Interpreting Section 7202 The purpose of section 7202 is to assure compliance by employer with its obligation to withhold and pay the sums withheld, by subjecting the employer's officials to criminal penalties for any delinquencies. Slodov v. United States, 436 U.S. 238, 247 (1978) superseded by statute on other grounds as stated in Begier v. United States IRS, 878 F.2d 762, 766 (3d Cir. 1989). Section 7202 requires that persons both account for and pay over withholding taxes, and persons subject to this obligation may be convicted upon a showing that the person failed to pay over the tax even if there is a showing that the person accounted for the tax. United States v. Thayer, 201 F.3d 214, 220 (3d Cir. 1999) cert. denied 530 U.S. 1244 (2000). Furthermore, willfulness is an essential element of the crime. United States v. Palermo, 259 F.2d 872, 882(3d Cir. 1958). A series of knowingly and intentionally made defaults, indicating a pattern of behavior, may suggest the existence of a specific "evil motive"; mere laxity, or careless disregard, or even gross negligence, absent an "evil motive" may not be probative of "willfulness." Id. In prosecuting a case under section 7202, both the failure to account for and to pay over the owed taxes must be willful. United States v. Poll, 521 F.2d 329, 334 n.3 (9th Cir. 1975).
26 U.S.C. § 7203 (2007).
The Crime It is a misdemeanor violation of section 7203 for a person who
is required under this title to pay any estimated tax or tax, or required by this title or by regulations made under authority thereof to make a return, keep any records, or supply any information,
pay such estimated tax or tax,
make such return,
keep such records, or
supply such information,
at the time or times required by law or regulations
In the case of a willful violation of a provision of 26 U.S.C. § 6050I, the aforementioned violation will be considered a felony.
The Punishment The Punishment for a misdemeanor violation of section 7203 is
a fine of not more than $25,000 ($100,000 in the case of a corporation),
imprisonment for not more than 1 year, or
The person guilty of a misdemeanor violation of section 7203 will also be required to pay the costs of prosecution.
If a person commits a willful violation of section 6050I, the punishment will consist of
a fine of not more than $25,000 ($100,000 in the case of a corporation);
The person guilty of a felony violation of section 7203 will also be required to pay the costs of prosecution.
Exception In the case of any person with respect to whom there is a failure to pay any estimated tax, this section shall not apply to such person with respect to such failure if there is no addition to tax under 26 U.S.C. §§ 6654 or 6655 with respect to such failure.
Case Law Interpreting Section 7203 In order to convict a defendant on a charge of willfully failing to file an individual income tax return in violation of section 7203, the Government is required to establish that the defendant was the person required by law to file the return, that he failed to file at the time required, and the failure was willful. United States v. Londe, 449 F. Supp. 590, 593 (E.D. Mo. 1978). Furthermore, it should be noted that sections 7203 and 7201 are separate and distinct offenses; section 7203 consists of failure to file a tax return and section 7201 consists of tax evasion, which means that a defendant can be convicted of both and sentenced to serve cumulative periods. United States v. Defazio, 899 F.2d 626, 636 (7th Cir. 1990).
26 U.S.C. § 7206 (2007).
The Crime It is a felony violation of section 7206 for a person to do any of the following:
Willfully make and subscribe any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter; 26 U.S.C. § 7206(1);
Willfully aid or assist in, or procure, counsel, or advise the preparation or presentation under, or in connection with any matter arising under, the internal revenue laws, of a return, affidavit, claim, or other document, which is fraudulent or is false as to any material matter, whether or not such falsity or fraud is with the knowledge or consent of the person authorized or required to present such return, affidavit, claim, or document; Id. § 7206(2);
Simulate or falsely or fraudulently execute or sign any bond, permit, entry, or other document required by the provisions of the internal revenue laws, or by any regulation made in pursuance thereof, or procure the same to be falsely or fraudulently executed, or advise, aid in, or connive at such execution thereof; Id. § 7206(3);
Remove, deposit, or conceal, or be concerned in removing, depositing, or concealing, any goods or commodities for or in respect whereof any tax is or shall be imposed, or any property upon which levy is authorized by 26 U.S.C. § 6331, with intent to evade or defeat the assessment or collection of any tax imposed by this title; Id. § 7206(4);
In connection with any compromise under 26 U.S.C. § 7122, or offer of such compromise, or in connection with any closing agreement under 26 U.S.C. § 7121, or offer to enter into any such agreement, willfully-
conceal from any officer or employee of the United States any property belonging to the estate of a taxpayer or other person liable in respect of the tax, Id. § 7206(5)(A); or
receive, withhold, destroy, mutilate, or falsify any book, document, or record, or make any false statement, relating to the estate or financial condition of the taxpayer or other person liable in respect of the tax. Id. § 7206(5)(B).
The Punishment The punishment for a violation of section 7206 is
imprisonment for not more than 3 years, or
The person convicted for a violation of section 7206 will also be required to pay the costs of prosecution.
Case Law Interpreting Section 7206
Section 7206(1) does not require the prosecution to prove intent to evade the payment of taxes, nor does it require the prosecution to prove the existence of any taxable income; all that is required is that Government prove that the defendant willfully made and subscribed a return, that it contained a written declaration that it was made under penalties of perjury, and that the defendant did not believe the return to be true and correct as to every material matter. United States v. Taylor, 574 F.2d 232, 234 (5th Cir. 1978); see also United States v. Tarwater, 308 F.3d 494, 504 (6th Cir. 2002) (same); United States v. Wilson, 887 F.2d 69, 72 (5th Cir. 1989) (same).
Therefore, section 7206(1) is a fraud statute. Id. As such, "willfully" in this context does not require an "evil motive" as seen in section 7201; it simply means that the defendant voluntarily and intentionally violates a known legal duty. United States v. Pomponio, 429 U.S. 10, 12 (1976). This can lead to some odd decisions. In United States v. Reynolds, 919 F.2d 435 (7th Cir. 1990), the defendant filed his taxes on Form 1040EZ, on which he neglected to include income he "earned" by skimming the coffers of the place at which he worked. Reynolds at 437. Because the form does not have a line for income obtained illegally, he did not commit perjury as punished by section 7206(1). Id.
Because the government did not charge the defendant under the more appropriate section 7201 or 7202, the court had to vacate the tax convictions in this case. Of course, the defendant was still guilty of embezzlement and other statutory violations.
Turning to other provisions of section 7206, which get very little attention, the offense involved in section 7206(2), aiding in the preparation and presentation of a false return, is committed at the time the return is filed, not the date on which it was due to be filed. United States v. Habig, 390 U.S. 222, 223 (1968). Section 7206(4) makes the removal or concealment of property upon which a levy is authorized a felony. United States v. Schwartz, 390 F.2d 1, 2 (3d Cir. 1968).
One final, overarching consideration: a person cannot fail to pay tax or violate any of the sections of 26 U.S.C. § 7201 et seq. as a symbolic protest against the government. United States v. Malinowski, 472 F.2d 850, 856 (3rd Cir. 1973). In Malinowski, the defendant disagreed with the United States going to war in Vietnam, and therefore filled out a fraudulent Employee Withholding Exemption Certificate (Form W-4) with fifteen exemptions, in violation of 26 U.S.C. § 7205. Id. at 852. The court characterized the defendant's First Amendment argument as "a suggestion that a member of society can be absolved of the responsibility for obeying a given law of the community, state, or nation if he can prove a sincere, abiding, and good faith objection to the direct or indirect object of that law." Id. at 857. The court rejected the defendant's "feeble effort to emasculate basic principles of civil disobedience." Id.