Is My Case Criminal? Civil Fraud vs. Tax Evasion (a crime)
- Steven L. Walker PLC
- Dec 21, 2015
- 1 min read
When does a taxpayer’s negligence, inadvertence, mistake, or good-faith misunderstanding of the law rise to the level of a civil fraud penalty or criminal offense, such as tax evasion? Stated differently, when does the government view failing to report income, claiming false deductions, or filing an incorrect tax return trigger a criminal investigation and possibly a referral to the Department of Justice for prosecution?
There is sometimes a fine line between a civil and criminal tax case. Although the government must establish that the taxpayer’s conduct was willful in either case, it is not always easy to predict whether the IRS will refer a case for criminal prosecution. There are, however, some telltale signs to look out for and important strategic moves a taxpayer can take to steer clear from a problem with the government.
This article published in 2015 explores the factors the IRS looks at in deciding whether a case is criminal.
