Have You Been Arrested for Federal Tax Evasion in Texas?

Tax evasion is the illegal act of not paying taxes owed by deliberately misrepresenting or concealing income. The consequences of being convicted for federal tax evasion are severe, including hefty fines and possible imprisonment.

If you find yourself confronted with federal tax evasion charges, you’ll want to promptly consult with a criminal defense attorney. For valuable guidance and support, reach out to Cofer & Connelly, PLLC, at (512) 991-0576 or through our online contact form to schedule a consultation with a tax evasion lawyer. 

What is Considered Federal Tax Evasion?

Under federal law, tax evasion means a deliberate action you take to avoid paying taxes that you legally owe. Essentially, if you intentionally try to avoid paying the full amount of taxes due, you could be charged with tax evasion. The law, specifically 26 USC § 7201, covers a range of actions that might constitute evasion. It's not just about lying on your tax return; it includes any intentional act you might undertake to reduce your tax liability unlawfully.

For you to be convicted of tax evasion, three main elements must be proven by a prosecutor beyond a reasonable doubt. 

• First, they must show that you actually had a significant tax due—more than what was reported on your tax return or what you paid. It’s not about small discrepancies but substantial amounts that make a real difference in your tax liability.
• Second, the prosecution must demonstrate that you actively tried to evade paying this tax. This isn't about passive mistakes or forgetfulness. It's about deliberate actions—like hiding income, inflating deductions, or keeping two sets of books. The key here is that these actions are done with the intent to mislead or hide the true state of your finances from the tax authorities.
• Finally, the action must be willful. This means that you knew you had a tax duty, and you voluntarily chose to ignore it or act against it.

If you sign a tax return, unless there's strong evidence to suggest otherwise, it's assumed you know what's in it and are attesting to its accuracy.

Penalties for Federal Tax Evasion in Texas

Tax evasion is a felony offense. The penalties for this offense are severe. If convicted, an individual faces a fine of up to $100,000, while corporations may be fined up to $500,000. In addition to financial penalties, there is also the possibility of imprisonment for up to 5 years.

Potential Defenses to Tax Evasion Charges

In cases of tax evasion, several defenses can potentially be used based on the specifics of the charges and the circumstances surrounding the alleged evasion.

Lack of Intent

One key defense is the lack of willful intent. Since tax evasion requires the willful attempt to evade taxes, you can argue that any action or omission was due to a misunderstanding or mistake rather than a deliberate attempt to avoid paying taxes. If it can be shown that you genuinely believed your tax filings were accurate and that you had no intention to deceive or defraud, this may counter the accusation of willfulness.

Misled By Professional Advice

Another possible defense is reliance on professional advice. If you relied on the guidance of a tax professional or advisor when preparing and filing your taxes, and it turns out the advice was incorrect, you might not be held responsible for the evasion, provided you can demonstrate that your reliance was reasonable and in good faith.

If there's evidence suggesting that your actions were based on a genuine misunderstanding of the law, and not an intentional disregard of it, you might use this as a defense. However, merely disagreeing with the tax laws or finding them unjust does not constitute a defense. The misunderstanding must be reasonable and in good faith.

Also keep in mind that the burden of proof is on the prosecution to prove beyond a reasonable doubt that you willfully attempted to evade paying taxes. If the evidence presented does not meet this high standard, the charges may be dismissed.

Comparison to Tax Fraud

26 USC § 7201 concerns the willful attempt to evade or defeat tax. For example, if someone intentionally does not file a tax return to avoid paying taxes, they are violating this law. On the other hand, 26 USC § 7206 deals with making fraudulent or false statements in tax matters. An example of this would be someone filing a tax return with knowingly false information, like inflated deductions.

Role of a Tax Evasion Lawyer in Austin, TX

If you're charged with tax evasion, a criminal defense lawyer becomes your most important ally. These types of lawyers know criminal tax laws and how to guide you through the legal process. They will scrutinize the prosecution's evidence, looking for weaknesses or procedural errors that could benefit your case. Your lawyer will also ensure your rights are protected throughout the legal process, represent you in court, and negotiate with prosecutors, possibly reducing charges or penalties. Most importantly, they will craft a defense strategy that fits your unique situation, aiming to achieve the best possible outcome in your case.

Frequently Asked Questions about Tax Evasion

• What exactly is tax evasion?
  Tax evasion is intentionally avoiding paying federal taxes you legally owe, often by not reporting all your income or claiming unentitled deductions.
• How severe are the penalties for tax evasion?
  Penalties can include fines up to $100,000 for individuals, $500,000 for corporations, and/or imprisonment for up to 5 years.
• Is failing to file a tax return the same as tax evasion?
  Not necessarily. While failing to file can be part of tax evasion, simply not filing a return without more does not automatically mean tax evasion.
• What does 'willfully' mean in the context of tax evasion?
  "Willfully" means you intentionally violated a known legal duty, such as knowingly not reporting income.
• Can a mistake on my tax return be considered tax evasion?
  No, if it's a genuine mistake. Tax evasion requires intentional wrongdoing.
• What is an affirmative act of tax evasion?
  It's a deliberate action taken to mislead the IRS, like hiding income or inflating deductions.
• Does the IRS need to prove how much I owe to charge me with tax evasion?
  They need to prove you owe substantially more than reported, but not the exact amount.
• Can I be charged with tax evasion if I didn't file a return?
  Yes, if you owed taxes and willfully did not file as part of an effort to evade taxes.
• What should I do if I'm accused of tax evasion?
  Consult with a federal tax evasion attorney immediately to understand your rights and options.
• Is it too late to correct my tax return if I realize I made an error?
  No, you can file an amended return, but it's best to first consult a tax professional or attorney.

Contact a Federal Tax Evasion Attorney in Austin

If you're facing tax evasion charges, it's important to consult with a criminal defense lawyer as soon as possible. For meaningful guidance, contact Cofer & Connelly, PLLC by calling (512) 991-0576 or contacting us online for a consultation with a tax evasion lawyer. Our experienced attorneys understand the seriousness of your situation and are ready to support you through each step of your case.