Tax evasion is a federal offense in the U.S. The crime occurs when people or businesses intentionally underpay or refuse to pay their tax obligations. The commission of tax evasion is a felony offense that can result in a federal prison term of up to five years. Please contact a skilled criminal defense attorney now if you or a loved one is facing tax fraud charges.

How Does Federal Law Define Tax Evasion?

26 U.S.C. 7201 is the federal statute that sets forth the offense of tax evasion. Per this law, people commit tax evasion if they willfully attempt to evade or defeat any tax imposed. Note that a violation of this statute requires some affirmative act where a person or company intentionally evades a tax obligation. A simple failure to file a tax return is not enough to rise to the level of tax evasion.

Please keep in mind though that making a false statement on a return is a separate federal offense under 26 U.S.C. 7206(1). In particular, it is a crime under this law if a person:

  1. knowingly signs and submits a tax return that contains a material false statement, and
  2. does so in order to intentionally violate a legal duty.

The Internal Revenue Service (IRS) is one of the main federal agencies that investigates alleged tax crimes. It employs special agents who are responsible for detecting and investigating tax evasion and related federal offenses.

What are the Penalties?

Tax evasion is a felony offense (as opposed to a misdemeanor). The crime is punishable by:

  • custody in a state prison for up to five years, and/or
  • a maximum fine of $100,000.

If a company violates 26 U.S.C. 7201, then it faces a maximum fine of $500,000 rather than $100,000.

Can a Defendant Raise a Legal Defense?

Fortunately, people or corporations accused of tax evasion can challenge the accusation with a legal defense. A common defense is for defendants to try and show that they did not act intentionally. For example, sometimes people fail to make a tax payment due to a mistake or simple carelessness. This type of failure is not a crime. Rather, someone has to intentionally avoid a tax obligation to be guilty of evasion.

Further, an accused can always challenge a charge by showing that the police acted unreasonably or even unlawfully. Maybe, for example, a police officer:

  • made false statements in a search warrant application,
  • arrested a defendant without probable cause,
  • made an arrest only after an unlawful search and seizure, or
  • coerced a confession.

Contact Black & Askerov for Help

While a defendant can raise a legal defense in a tax evasion case, it will take a skilled criminal defense attorney to raise the best defense. The experienced tax fraud attorneys at Black & Askerov have over 30 years of combined experience defending clients on tax-related and similar federal charges. Our Seattle criminal defense lawyers have the skill and commitment that makes all the difference in these cases. Our attorneys will fight tooth and nail for you at every step of your case. Contact us now to get the legal help you deserve!