Filing your income taxes is a difficult task. You may make a mistake that benefits you without realizing it. Unfortunately for the IRS, these errors may appear to be tax fraud, a serious crime. Nobody wants to face felony charges and have to defend themselves in court due to a mistake.
The Internal Revenue Service takes filing a fraudulent tax return or another document seriously. Civil cases can be forwarded to criminal tax investigations if relevant material is discovered in the inquiry. Arrests and criminal prosecutions relating to taxes are possible outcomes. Criminal defense attorney David Stanley represents those accused of tax fraud who face life-altering criminal accusations. He is an experienced tax attorney with expertise in IRS investigations and tax law cases involving fraud allegations.
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Ways Someone Can Commit Tax Fraud Without Meaning To
Below are ways you could unintentionally trigger an IRS investigation into your taxes.
1. Forgetting To Report A Portion Of Your Earnings
On the W-2 form they obtained from their employer, many people report the amount of income they made. On the other hand, others have a diverse collection of income streams. When the time comes to file taxes, it’s easy to forget about cash income, such as tips, if it’s one of the sources of income you receive.
2. Inaccurate Non-cash Donation Appraisals
It is not difficult to keep track of monetary donations made to charitable organizations. However, donations of things other than money, such as clothes or a used car, are also eligible for tax breaks. The problem arises when you are unsure of the value of the contributions that have been made. If you claim a deduction for an amount that is significantly higher than what the item is worth, you may be committing tax fraud.
3. Deduction Errors
Several deductions are available under Louisiana and federal tax law, including those for education and medical expenses. Therefore, an incorrect number might land you in legal trouble, even if it was an honest error.
4. Mixing Business And Personal Expenses
The distinction between company and personal spending is not always evident when you own a business. Deducting the incorrect amount on your taxes can lead to significant issues later.
5. Failure To File Tax Return
It is a criminal to purposefully fail to file an income tax return by the deadline (or to file for an extension). You may have missed the deadline by accident, but the IRS may still pursue you.
Frequently Asked Questions
What Are The Signs That Fraud Has Occurred?
The IRS has a track record of falsely accusing innocent taxpayers of tax fraud. In some cases, the IRS will open an inquiry because of seemingly innocuous circumstances, leading them to believe that criminal tax fraud has occurred. The IRS considers the following factors to be red flags for possible tax fraud:
1. Increases in net worth that aren’t explained
2. Personal spending that exceeds a taxpayer’s available resources
3. Unaccounted-for deposits into a bank account that significantly exceed the taxpayer’s stated income
4. Documents that appear to be forged, misrepresented, or tampered with
What Are The Consequences Of Tax Fraud?
Criminal tax fraud convictions carry severe penalties, including prison time and hefty fines. In addition, the prosecution can impose criminal penalties to punish the taxpayer and deter other taxpayers from committing fraud.
Why Is It Important To Hire A Tax Fraud Defense Lawyer?
Our tax fraud defense lawyer at David E Stanley APLC gives the guidance that our clients require. We recommend contacting our law office as soon as you are served with a Federal Grand Jury summons, an IRS summons for papers, or a visit from a special IRS agent. It would help if you waited to speak with a professional attorney before voluntarily submitting the IRS a statement. The IRS can and will use your information against you if your case goes to trial. For our clients, we develop a complete criminal defense strategy. Working with forensic accountants, other industry specialists, and professionals is a standard part of our strategy.
A Trusted Tax Fraud Defense Lawyer
A tax fraud conviction can result in a prison sentence and significant financial fines. However, a tax defense attorney can represent you and possibly negotiate a settlement that allows you to avoid prison and have the charges dismissed.
Are you facing fraud charges? David E Stanley APLC can help. He is a renowned trial lawyer who devotes his practice to defending persons and businesses accused of significant or complex felony crimes and those seeking to overturn an unjust criminal conviction or disproportionate punishment. He is exceptionally dedicated and skilled in the area of federal criminal defense.
David Stanley is the founder and principal of David E. Stanley APLC. Since 1983, Mr. Stanley has successfully practiced law from his office in Baton Rouge, Louisiana.