Tag Archive for Tax Crimes

Ironclad Defenses To Tax Crimes – Part II

II. Good-Faith Belief Defense

A key element of most tax crimes is willfulness. The government must show that the defendant willfully evaded taxes or willfully filed a false return. This means that the government must prove that (1) the defendant knew what was required by law and, (2) notwithstanding, intentionally violated the law.

This definition raises several opportunities for the defense. For example, the defendant may introduce evidence that he was mistaken as to the state of the law or that he had a good-faith misunderstanding as to what the law provided. Such a defense would negate willfulness and would enable the jury to acquit. On the other hand, a good-faith belief that Read More

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Ironclad Defenses To Tax Crimes – Part I

I. Forgotten-Deduction Defense

In a tax evasion case, the government bears the burden of proving that the defendant had a substantial tax deficiency. Defendants often try to show that there was no deficiency, that their return was substantially accurate, or at least raise questions pertaining to the government’s calculations. The argument usually goes something like this: “I had unclaimed deductions.”

The most famous example of this is United States v. Helmsley, 941 F.2d 71 (2d Cir. 1991). There, the defendant used one method of depreciation on her return. When the government charged her with tax evasion and put on evidence of a deficiency, the Read More

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Ironclad Defenses To Tax Crimes – Introduction

Introduction

Affirmative defenses are rare in criminal tax cases. The government has the burden to prove each and every element of the offense beyond a reasonable doubt. As a result, the burden is generally on the government to prove all the relevant facts to the jury, and the defendant may simply put on evidence that will counter the government’s proof.

What this means is that the defendant can deny having the required mental state to commit tax evasion without shifting the burden from the prosecution to himself to prove that he lacked the required mental state. Indeed, the burden remains firmly on the prosecution. Sandstrom v. Montana, 442 U.S. 510, 524 (1979). To the extent that the Read More

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Internet Enables Thieves To Steal $4 Billion In Tax Refunds

Criminals are utilizing their Internet connection to file false tax returns that help them steal refunds from the innocent. In 2013, fraudulent returns saw almost $4 billion sent into the hands of scam artists. Making things worse is the fact that the Internal Revenue Service is having a hard time stopping the fraud from happening in the first place.

The United States Attorney General, Eric Holder, says that 880 people have been charged to date, but also says that the scale and scope of the tax fraud schemes has grown substantially. Holder has been a victim of tax fraud himself. Two Georgia men recently plead guilty to charges stemming from their attempt to get a refund by using Holder’s name, Social Security number and date of birth on returns. Read More

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Can I Be Extradited For Commiting A Tax Crime?

treatyExtradition, the formal surrendering of a person by one country to another country in order that the fugitive may be prosecuted or punished, often depends on the existence of an extradition treaty.  While the United States has attempted extradition proceedings in the absence of a treaty, the US courts have generally not supported these attempts and so, the bite of law enforcement may be somewhat limited in the absence of an appropriate extradition treaty.

An extradition treaty is in the nature of an agreement or contract between its signatory countries.  Extradition treaties have been signed between the US and over one hundred nations throughout the world.

Most treaties contain a list of crimes for which extradition may be granted such as murder; voluntary manslaughter; rape; unlawful abortion; kidnapping; burglary; larceny; embezzlement; fraud; bribery and so on.

Modern Treaties Permit Extradition For Felony Offenses

The more modern extradition treaties embrace a so-called “dual criminality approach”. Under this approach the act in question must be a crime under the laws of both the USA and the country where the fugitive is taking refuge.  Under these treaties, generally speaking, all felonies are extraditable offenses.  Such modern treaties also delineate various classes of offenses the commission of which would not be grounds for  extradition (these include for example, military and political offenses; offenses carrying capital punishment; crimes that are punishable under only the laws of one of the treaty signatories; crimes committed outside the country seeking extradition; instances when the fugitive is a national of the country in which extradition is sought and so on). Read More

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