A WORLD OF SHADOWS
In the world of tax law, there is likewise an unsettling ambiguity about whether certain conduct is to be viewed as criminal or merely careless or negligent. Rather than a bright red line one encounters a large gray continent traversed at great risk. Like Josef K having come under scrutiny one becomes somewhat powerless in the grip of a baffling process.
TAX EVASION
The crime of tax evasion involves a willful attempt to evade or defeat any income tax or the payment thereof. With regard to evading tax, the government must prove: (1) a tax deficiency, i.e., that less than the correct tax was reported in the originally filed return; (2) an attempt to evade the tax; and (3) that the attempt was willful. The attempt is proved through overt acts such as filing the false return, hiding assets and sources of income, keeping two sets of books or making false entries or alterations. Willfulness is not the presence of an evil motive but rather a voluntary, intentional violation of a known legal duty. For example, John Smith knows that his commission income is taxable but nonetheless files his income tax return knowingly leaving out the commissions. He has acted willfully.
Tax evasion is a major felony carrying up to a 5 year prison sentence and $250,000 fine, or both.
TAX PERJURY
A tax return is signed under penalties of perjury. Lying in a tax return as to any material statement constitutes th... Read More »