Too often, individuals and companies operating outside tax compliance believe they will not be noticed and will never be investigated. Each year, the IRS sees strong prosecutorial success against those who believe they will not be caught. Committing one tax crime can easily lead to another, like tax evasion. Most business owners with a second set of books, or who are skimming their payroll taxes, do not report the extra income on their income tax returns. It adds up.
The Criminal VDP exists to assist taxpayers move toward compliance, rather than continuing to compound the potential charges they face. Eligibility depends on factors that include:
In other words, the VDP is no longer an option if the wrongdoing is already out of the bag. The Criminal VDP does not offer automatic immunity from prosecution—but it can work in your favor in the form of a recommendation against criminal charges if you are actively engaged in the process, providing accurate information, and working to correct the situation and repay the IRS.
The Criminal VDP is good business. It can reduce the risk of prosecution and prison for potential defendants, reduce or eliminate the cost of prosecution, and bring money in the door.
The Criminal VDP is a long-time program. In 2018, changes to the program raised concerns among taxpayers and their criminal tax attorneys. According to the Taxpayer Advocate Service (TAS), the IRS added a checkbox that essentially forced users to admit that they willfully broke the law. Essentially, this is a required act of self-incrimination. It is believed that the inclusion of the box reduced the popularity of the program.
Fast forward to 2025. The National Taxpayer Advocate suggested the IRS remove the willfulness checkbox, and the IRS has agreed to eliminate it from the next version of the VDP Form 14457.
Even with this change, the Criminal VDP is not to be entered into lightly. If you would like to shed the weight of a tax scam or scheme, your first step is to speak with a knowledgeable criminal tax attorney—soon.
If you have filed questionable tax documents or failed to file regulatory reports, speak with legal counsel who is experienced and successful with criminal tax defense. Call us at 440-250-9709 or reach out to set up a consultation. We serve domestic and international clients from offices in Cleveland and Chicago.
Not sure what to expect if you are already under scrutiny? Download our free eBook, Understanding Tax Fraud, for insights into warning signs and potential legal defenses.