When it comes to the Internal Revenue Service and allegations or charges of criminal wrongdoing, much depends on an individual taxpayer's intent. In a criminal IRS matter, the IRS bears the burden of proving that an individual intentionally acted to misrepresent or lie about tax-related matters.
If the IRS is able to prove that an individual committed fraud, he or she will likely face hefty penalties including fines and time in prison. It's important; therefore, that individuals facing an IRS investigation or criminal charges secure legal representation.
The following are examples of the types of evidence the IRS may present when attempting to prosecute an individual for criminal charges related to tax crimes like tax fraud, tax evasion and identity theft.
- Failing to report income - this is often especially an issue for individuals or business owners who are paid or deal in cash
- Using business funds for personal expenditures
- Claiming unwarranted tax deductions
- Using false social security numbers or other identifying information
- Attempting to hide assets
- Claiming false exemptions
- Failing to have or creating false financial documents to support one's tax actions
The IRS is ruthless in its pursuit of individuals it believes owe the government money or who it believes have personally profited at the government's expense. Tax-related crimes are considered felonies and therefore the implications of being convicted of tax fraud or tax evasion are more serious and far-reaching than many people realize.
In addition to paying fines and potentially serving months or years in prison, having a felony conviction can have negative implications when it comes to finding a job and securing housing.
Source: FindLaw.com, "Avoiding Behavior the IRS Considers Criminal or Fraudulent," 2014