Understanding Tax Evasion Charges
Tax evasion consists of both illegal nonpayment and underpayment of taxes. Even if a taxpayer doesn’t submit the necessary tax forms, the IRS can still discern whether or not taxes were owed by examining documents that must be submitted from third parties such as W-2s from employers or 1099s. A person is usually only considered guilty of evading their taxes when it is determined to have been done intentionally.
Delinquent taxpayers should be aware of the serious ramifications they may face. It must first be demonstrated that their failure to pay taxes was done intentionally, after which point the IRS can impose significant penalties ranging from substantial fines up to and including jail time. For individuals, this could mean a maximum penalty of five years imprisonment or $250,000 in fines (or both). Similarly, corporations are liable for a possible fine of $500,000 along with associated prosecution costs.
NRS 360.340 Penalty for deficiency resulting from fraud or intentional evasion of payment of tax or fee or of regulations. If any part of the deficiency for which a deficiency determination is made is due to fraud or an intent to evade the payment of a tax or fee administered by the Department or the authorized regulations of the Department, a penalty of:
1. Except as otherwise provided in subsection 2, 25 percent of the amount of the determination must be added thereto.
2. In the case of a tax imposed pursuant to chapter 372 or 374 of NRS with respect to the sale, storage, use, or other consumption of any vehicle, vessel, or aircraft, three times the amount of the determination must be added thereto.
Types of Tax Avoidance
Taxpayers have many options available to them to lower their tax burden, including claiming credits and deductions, and utilizing exclusions or loopholes within the U.S Tax Code. Below are a few of these powerful tools that can be used in order to take advantage of tax avoidance strategies:
The Standard Deduction
According to the Urban-Brookings Tax Policy Center, almost all households will take advantage of the standard deduction for their taxes in 2022 and 2023. The amount allocated for single filers is $12,950 this year and rises to an even higher figure of $13,850 next year. Married couples filing jointly are currently entitled to a sum of $25,900 which is increased to a maximum rate of $27,700 come 2023.
Most Americans are unable to benefit from the mortgage interest deduction, especially with the Tax Cuts and Jobs Act (TCJA) of 2017. This act caused a substantial rise in standard deductions while capping deductions for state and local taxes at $10,000.
Many small business owners, freelancers, and investors are motivated to save every eligible expense receipt for deductions. Others take on the IRS challenge by trying to leverage all possible credits and deductions available. However, this tax-saving strategy can quickly become abused and require a Las Vegas tax evasion defense attorney if the IRS comes after you.
When saving money for your retirement, you’re likely engaging in tax avoidance – and that’s a good thing! Employer-sponsored retirement plans or individual Retirement Accounts (IRAs) make it so easy to avoid taxes. In addition, every person who invests in them benefits from this wise decision over the long term.
Traditional plans permit investors to achieve a significant tax advantage each year, up to the annual limit set by the IRS. As they withdraw their savings upon retirement, taxes will be due on those funds; however, since retirees’ taxable income is likely lower at that point in life than during peak earning years, less money can end up going towards taxes – this is known as tax avoidance.
With Roth plans, investors can save their hard-earned money in after-tax accounts and reap the benefits of tax breaks later on when they are retired. Every penny saved is 100% tax-exempt. What’s more, Roths make it possible for savers to prevent income taxes from profiting off their contributions in the long run.
Don’t let taxes eat away your hard-earned money! Utilize deductions available through your workplace to reduce the amount of taxes you owe. You could be able to list certain non-reimbursed costs on your tax return, which are essential for job performance purposes. Examples include mileage in a personal car, union dues, or any tools you may require for work tasks.
By exploiting loopholes in the U.S. Tax Code, corporations and high-net-worth individuals are able to avoid paying higher taxes at home while reaping numerous benefits from relocating their money to offshore tax havens – places with looser regulations, more attractive fiscal laws and policies, diminished financial risks, as well as confidentiality protections. Through creating subsidiaries or opening bank accounts abroad these entities can secure greater monetary gains by escaping hefty taxation rates back home.
Felony of willful evading or defeating tax may include one or several of other offenses against revenue laws, but it cannot be regarded as meaning no more than same dereliction defined in other portions of statute as misdemeanors; difference between misdemeanor of willful failure to pay tax when due and felony offense of willful intent to evade or defeat tax, is found in affirmative action implied from term “attempt” as used in felony section. Spies v. United States, 1943-1 U.S. Tax Cas. (CCH) P 9243, 43-1 U.S. Tax Cas. (CCH) ¶ 243, 317 U.S. 492, 63 S. Ct. 364, 87 L. Ed. 418, 1943 C.B. 1038, 30 A.F.T.R. (P-H) 378, 1943-1 U.S. Tax Cas. (CCH) ¶ 9243, 43-1 U.S. Tax Cas. (CCH) P9243, 1943 U.S. LEXIS 1273 (1943).
Offense of willfully failing to make return is distinct and separate offense from that of willful evasion of tax. United States v. Capone, 1938-1 U.S. Tax Cas. (CCH) P 9011, 38-1 U.S. Tax Cas. (CCH) ¶ 011, 93 F.2d 840, 20 A.F.T.R. (P-H) 603, 1938-1 U.S. Tax Cas. (CCH) ¶ 9011, 38-1 U.S. Tax Cas. (CCH) P9011, 1937 U.S. App. LEXIS 2913 (7th Cir. 1937), cert. denied, 303 U.S. 651, 58 S. Ct. 750, 82 L. Ed. 1112, 1938 U.S. LEXIS 170 (1938).
Failure to file return will not confine prosecution for income tax evasion if prosecution by evidence of other affirmative acts can prove willful attempt to evade tax. United States v. Smith, 1953-2 U.S. Tax Cas. (CCH) P 9538, 53-2 U.S. Tax Cas. (CCH) ¶ 538, 206 F.2d 905, 44 A.F.T.R. (P-H) 342, 1953-2 U.S. Tax Cas. (CCH) ¶ 9538, 53-2 U.S. Tax Cas. (CCH) P9538, 1953 U.S. App. LEXIS 4117 (3d Cir. 1953).
Failure to pay tax and attempt to defeat and evade one, must both be willful; however difference between two offenses is found in affirmative action implied from term “attempt.” United States v. Bardin, 1955-1 U.S. Tax Cas. (CCH) P 9488, 55-1 U.S. Tax Cas. (CCH) ¶ 488, 224 F.2d 255, 47 A.F.T.R. (P-H) 1383, 1955-1 U.S. Tax Cas. (CCH) ¶ 9488, 55-1 U.S. Tax Cas. (CCH) P9488, 1955 U.S. App. LEXIS 5483 (7th Cir.), cert. denied, 350 U.S. 883, 76 S. Ct. 134, 100 L. Ed. 778, 1955 U.S. LEXIS 190 (1955), reh’g denied, 350 U.S. 919, 76 S. Ct. 193, 100 L. Ed. 805, 48 A.F.T.R. (P-H) 680 (1955).
Congress did not intend that attempts to evade tax would necessarily merge in offense of failing to pay tax; that such separateness was intended is made clear not only by language of statute but also by fact that provisions were included in Internal Revenue Code as separate actions. Reynolds v. United States, 1961-1 U.S. Tax Cas. (CCH) P 15337, 61-1 U.S. Tax Cas. (CCH) ¶ 5337, 288 F.2d 78, 7 A.F.T.R.2d (RIA) 1911, 1961-1 U.S. Tax Cas. (CCH) ¶ 15337, 61-1 U.S. Tax Cas. (CCH) P15337, 1961 U.S. App. LEXIS 5041 (5th Cir.), cert. denied, 368 U.S. 883, 82 S. Ct. 127, 7 L. Ed. 2d 83, 1961 U.S. LEXIS 394 (1961).
Word “willfully” has same meaning in 26 USCS § 7206(1) and § 7201. United States v. Bender, 1979-2 U.S. Tax Cas. (CCH) P 9656, 79-2 U.S. Tax Cas. (CCH) ¶ 656, 606 F.2d 897, 44 A.F.T.R.2d (RIA) 6028, 1979-2 U.S. Tax Cas. (CCH) ¶ 9656, 79-2 U.S. Tax Cas. (CCH) P9656, 1979 U.S. App. LEXIS 11069 (9th Cir. 1979).
26 USCS § 7201 is legal basis for prosecution of income evasions by means of filing false income tax returns; it overlaps with § 7207 and in case of conflict, § 7201 prevails. United States v. Adonis, 1956-2 U.S. Tax Cas. (CCH) P 9992, 56-2 U.S. Tax Cas. (CCH) ¶ 992, 146 F. Supp. 56, 50 A.F.T.R. (P-H) 869, 1956-2 U.S. Tax Cas. (CCH) ¶ 9992, 56-2 U.S. Tax Cas. (CCH) P9992, 1956 U.S. Dist. LEXIS 2376 (D.N.J. 1956).
Penalties for Tax Fraud in Las Vegas
Tax fraud can result in a mind-boggling 3-year federal prison sentence along with an extensive fine of up to $250,000. Tax evasion is even more severe; it could lead to 5 years of imprisonment and the same hefty penalty. Businesses that fail to comply with taxation laws may face double these repercussions. That equates to 6 or 10 years behind bars plus twice as much money is required as damages.
If you have been accused of committing a tax crime in Nevada, it is critical to obtain the help of an experienced Las Vegas tax evasion defense attorney immediately. The legal team at the Spartacus Law Firm has a proven history of victory when representing clients who are facing severe accusations of white-collar crimes in Las Vegas. We can use every one of our resources to assess your case and fight for justice on your behalf.
Don’t wait any longer, enlist our services to guarantee that all aspects are taken into account during this rough patch. Our mission is to achieve the best conceivable result for your situation, which can include getting accusatory charges reduced or even dropped completely. Depending on the specific circumstances and information regarding your case, it could also involve negotiating with state or federal prosecutors. With a federal criminal defense lawyer by your side, you can rest assured knowing we’ll work hard every step of the way in order to reach a favorable outcome for you.
NRS 205.377 Multiple Transactions Involving Fraud or Deceit in Course of Enterprise or Occupation; Penalty
1. A person shall not, in the course of an enterprise or occupation, knowingly and with the intent to defraud, engage in an act, practice or course of business or employ a device, scheme or artifice which operates or would operate as a fraud or deceit upon a person by means of a false representation or omission of a material fact that:
(a) The person knows to be false or omitted;
(b) The person intends another to rely on; and
(c) Results in a loss to any person who relied on the false representation or omission,
in at least two transactions that have the same or similar pattern, intents, results, accomplices, victims or methods of commission, or are otherwise interrelated by distinguishing characteristics and are not isolated incidents within 4 years and in which the aggregate loss or intended loss is more than $250.
2. Each act which violates subsection 1 constitutes a separate offense.
3. A person who violates subsection 1 is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 1 year and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $10,000.
4. In addition to any other penalty, the court shall order a person who violates subsection 1 to pay restitution.
5. A violation of this section constitutes a deceptive trade practice for the purposes of NRS 598.0903 to 598.0999, inclusive.
6. As used in this section, “enterprise” has the meaning ascribed to it in NRS 207.380.