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Tax Fraud
TAX FRAUD ALLEGATIONS CAN TURN YOUR LIFE UPSIDE DOWN
Tax fraud investigations are more common now ever before. The Internal Revenue Service (IRS) has units that are working day and night specifically working to find and pursue individuals and businesses suspected of manipulating tax returns, hiding assets, or underreporting income.
WE UNDERSTAND THE STRESS
When federal agents knock on your door or you receive a notice from the IRS, you may feel overwhelmed, scared, and uncertain about what to do next. What you do next matters; you need a criminal defense law firm to help you.
Regardless of who you are, or the stage of your tax case, or how crazy the accusations seem, we can help you. Our criminal attorneys know how to deal with tough cases.
AS SEEN IN COMPLEX FEDERAL CASES
We have experience handling state and federal tax fraud charges. We know how the government operates in these investigations. We know the evidence they rely on. We know how to fight back. You need to speak to Spodek Law Group in situations like this.
WHAT IS TAX FRAUD?
Tax fraud is the intentional act of deceiving the government about your true tax liability. Under 26 U.S.C. § 7201, any willful attempt to evade or defeat a tax is a felony. Tax fraud can take many forms, including:
- Underreporting Income (See U.S. Department of Justice, Criminal Tax Manual, Section 8.01)
- Overstating Deductions
- Failing to File Returns (See 26 U.S.C. § 7203)
- Maintaining Two Sets of Books
- Concealing Offshore Assets
If investigators believe you filed false returns or intended to defraud the IRS, you could be charged for a number of different crimes at once. For example wire fraud, tax fraudm etc.
In the federal system, prosecutors have immense resources. They often rely on financial experts, forensic accountants, and even cooperating witnesses.
POTENTIAL PENALTIES
The penalties for federal tax fraud are severe. You could face a number of penalties, such as:
- Up to 5 Years in Federal Prison for each count of willful tax evasion (26 U.S.C. § 7201).
- Hefty Fines ranging from thousands to hundreds of thousands of dollars.
- Restitution to reimburse the government for unpaid taxes, plus interest and penalties.
- Criminal Record that changes your personal and professional life forever.
Even non-felony charges like failure to file (26 U.S.C. § 7203) can mean jail time up to 1 year and serious fines.
STATE TAX FRAUD ACCUSATIONS
Many states have laws that mirror federal statutes because you have to pay both state tax, and federal tax. If you live in a jurisdiction with strict state tax laws, you might face separate charges from both state and federal authorities. In New York, for example, failing to file or falsifying returns can lead to felony charges under state tax law (See N.Y. Tax Law § 1801).
Regardless of the state, the allegations revolve around one premise: did you willfully misrepresent or hide income for financial gain?
CRIMES AND PUNISHMENTS
Underlining the severity of these offenses is crucial.
Tax Fraud is not a simple mistake.
It’s a deliberate misrepresentation. Prosecutors have to prove you acted intentionally. If they succeed, punishments vary for the crimes, such as:
- Criminal Fines that can exceed $100,000 for individuals and go even higher for corporations (26 U.S.C. § 7201).
- Incarceration in federal prison, often followed by supervised release.
- Probation or Community Service in some lesser tax misdemeanor cases.
- Loss of Professional Licenses if you’re a doctor, lawyer, or hold a professional credential.
- Career and Personal Ramifications including difficulty obtaining future loans, passing background checks, or securing business partnerships.
COMMON TAX FRAUD SCENARIOS
Case Highlights: We often see individuals or businesses face charges for a number of crimes such as:
- Cash Businesses failing to report full business revenue.
- Exaggerated Deductions like inflated charitable contributions or business expenses.
- Unreported Foreign Accounts (FBAR violations) that lead to additional scrutiny (31 U.S.C. § 5314).
- Failure to File year after year, leading to compounding penalties and criminal accusations.
- False Returns prepared by unethical tax preparers who promise “too-good-to-be-true” refunds.
WE PROTECT YOUR AND YOUR FAIMLY
We defend clients facing federal and state investigations for these issues every single day. Our firm is committed to fighting tooth and nail, regardless of how challenging the allegations may be.
WHY WE’RE THE TEAM YOU WANT
Experience. Knowledge. Aggressive Defense.
EXPERIENCED
We have spent years tackling some of the toughest financial crime cases across the country. We’ve seen the inside of federal courtrooms, negotiated with IRS Criminal Investigation Division (CID) agents, and combatted prosecutors who aim for the maximum penalties.
DEDICATED
We work tirelessly to ensure every piece of the government’s evidence is examined. We scrutinize documents, analyze bank statements, and consult with forensic experts to uncover the truth. We leave no stone unturned. Our goal is to save you, your life, your family, and get you the results you want.
REPRESENTING HIGH-PROFILE CLIENTS
We have been at the center of complex white-collar defense matters. While many of our clients are private individuals or small business owners, we also represent high-profile figures who require discreet and meticulous representation.
OUR LEGAL STRATEGIES
Regardless of whether you’re facing a grand jury subpoena, a target letter, or a post-indictment situation, we can help.
- Challenging Willfulness:
Tax fraud requires intent. We will highlight any evidence suggesting you relied on accountants or tax preparers, that your mistake was a misunderstanding of complex tax codes, or that you lacked fraudulent intent. - Negotiating With Prosecutors:
Sometimes, the best move is a plea agreement that minimizes your risk. Prosecutors are often willing to reduce charges or recommend leniency if you show cooperation, pay restitution, or provide evidence of your good faith. - Attacking the Evidence:
We may file motions to suppress evidence obtained unlawfully, highlight inconsistencies in financial records, or reveal questionable tactics by investigators (See United States v. Mapp, 476 F.2d 67 (2d Cir. 1973) for suppression standards). - Statute of Limitations:
Tax offenses often have specific deadlines. If the government waited too long to investigate, we will argue that charges should be dismissed under the applicable statute of limitations (See 26 U.S.C. § 6531). - Trial by Jury:
We aren’t afraid of trial. If the government’s evidence is weak or if a dismissal is not achievable, we will present a vigorous defense before a judge and jury. We cross-examine government witnesses, challenge forensic experts, and passionately argue your side. - Mitigation and Sentencing Advocacy:
If you do face conviction or plea negotiations, we strive to reduce sentencing exposure by highlighting your positive background, community ties, charitable contributions, and the presence of any mitigating factors. (See U.S. Sentencing Guidelines Manual § 2T1.1).
HOW WE WORK
Step One: Consultation
We speak with you—day or night—to understand the situation, your documents, your version of events, and your main worries.
Step Two: Investigate and Analyze
We gather bank statements, tax returns, receipts, payroll records—everything. We collaborate with financial experts who can interpret complex data.
Step Three: Strategy Development
Once we have a clear picture, we map out a plan: do we push for a quick resolution, or do we prepare for trial? Every client is unique. We tailor our approach to your goals.
Step Four: Negotiation or Trial
We engage with prosecutors if a plea or dismissal is possible. If not, we secure the best experts, file motions, and prepare for a courtroom battle.
Step Five: Post-Resolution
Even after the case is settled, we remain available. Tax issues can lead to additional civil audits. We help ensure you aren’t left struggling with unforeseen aftermath.
We stand by you from start to finish.
REAL CONSEQUENCES
TAX FRAUD ALLEGATIONS CAN RESULT IN YOUR BUSINESS SHUTTING DOWN
TAX FRAUD ALLEGATIONS CAN RESULT IN YOU LOSING PROFESSIONAL LICENSES
TAX FRAUD ALLEGATIONS CAN RESULT IN PRISON TIME
CASE EXAMPLE
“John,” a small business owner, was charged under 26 U.S.C. § 7201 for allegedly underreporting hundreds of thousands of dollars in income. Prosecutors insisted on seeking a prison sentence. We argued John’s accountant had manipulated the numbers without John’s full awareness. We identified third-party witnesses who testified that John consistently provided them receipts and bank records. Ultimately, the prosecution agreed to dismiss the most severe charges, leading to probation and a manageable financial penalty instead of prison time.
(This example is for illustrative purposes only. Actual results vary and depend on the specific facts and law applicable to each case.)
WHAT IF YOU’RE A TAX PREPARER OR CPA?
Tax professionals can face charges if the IRS accuses them of aiding or assisting in the preparation of false returns (26 U.S.C. § 7206(2)). Penalties often include fines, disbarment from practice, and possible prison time. We represent accountants, enrolled agents, and other tax preparers who are unjustly swept up in fraud investigations.
We fight. We protect. We defend.
INACTION IS NOT AN OPTION
The moment you suspect you’re under investigation, call us.
Delaying your defense only gives the government more time to build a case. IRS agents, federal prosecutors, and even your own business partners could be testifying against you by the time you realize the severity of the situation.
HOW WE KEEP YOUR INFORMATION CONFIDENTIAL
Our firm uses encrypted systems, secure client portals, and confidentiality protocols to protect your sensitive data. Financial documents, witness statements, and personal records remain under strict privacy measures.
FIGHTING FOR AN ACQUITTAL
Even if the government has a trove of evidence, an acquittal can be possible. If we can demonstrate:
- Lack of willfulness
- Insufficient proof of false statements
- Misconduct by investigators
- Invalid search warrants
- Reliance on tax professionals
there is a pathway to a not guilty verdict.
We never assume your case is unwinnable.
FEDERAL SENTENCING GUIDELINES
If convicted, federal judges look to the U.S. Sentencing Guidelines, specifically the sections on tax offenses (U.S. Sentencing Guidelines Manual §§ 2T1.1 – 2T1.9). The potential prison term can increase based on the total tax loss, sophisticated means used to commit the offense, and other factors.
Our job is to argue for downward departures or variances based on your history and the specific circumstances that led to the offense.
OPTIONS FOR RESOLUTION
- Pre-Indictment Advocacy:
- We attempt to persuade prosecutors not to bring charges.
- Plea Agreements:
- Sometimes cooperating with the government or entering an Alford plea can reduce penalties. (See North Carolina v. Alford, 400 U.S. 25 (1970)).
- Deferred Prosecution:
- In rare instances, the government may agree to defer prosecution if you comply with specific conditions.
- Trial:
- We present your case to a jury if negotiations fail.
- Appeals:
- If convicted, we can explore appellate remedies to challenge errors in the trial court.
CAN TAX FRAUD BE EXPUNGED?
Federal felonies are notoriously difficult to seal or expunge. Most states also have strict rules preventing expungement of serious offenses. In some scenarios, pardons or commutations are possible, but rare. We can advise you on all post-conviction options if necessary.
WE’RE AVAILABLE 24/7
Tax fraud investigations don’t keep business hours. Agents can show up unannounced. You might receive phone calls from “Special Agents” at odd times. Our team is on call to provide emergency legal advice so you don’t inadvertently harm your defense by speaking with investigators alone.
CLIENT TESTIMONIAL
“I was terrified of going to prison for a tax issue that started as a small mistake on my returns. This firm listened to me, explained my options, and fought for me every step of the way. They saved my career.”
(Testimonial is a dramatization of our clients’ experiences. Individual outcomes may vary.)
WHY WAIT?
We know you’re worried about your future.
We’re here to provide clarity, stability, and an aggressive defense plan. From initial investigation to potential trial, we stand by you.
YOUR NEXT STEP
Contact us now for a confidential consultation. We’ll discuss your case, review your records, and lay out a strategy that makes sense for you.
WE MAKE NO JUDGMENTS
Some clients fear disclosing all details because they worry about being judged. Our job is not to pass moral judgment; our job is to defend you vigorously. Being open and honest with us is crucial to building the strongest possible defense.
We believe in second chances. We believe in finding the best possible resolution.
HELPING BUSINESSES, INDIVIDUALS, AND TAX PROFESSIONALS
Whether you’re a small business owner, a high-net-worth individual, or an accountant facing allegations of assisting in fraud, we can help.
REMEMBER
Tax fraud isn’t just a matter of paying a penalty and moving on.
When prosecutors consider criminal charges, they’re looking at your entire financial history, your communications, and your level of cooperation.
FREQUENTLY ASKED QUESTIONS
What if I made a mistake but didn’t intend to commit fraud?
Intent is a key element of tax fraud. If we can show an honest mistake rather than willful evasion, we may get charges reduced or dismissed.
Can paying back taxes prevent prosecution?
While paying back taxes can help, it doesn’t automatically stop a criminal case. Prosecutors sometimes pursue charges even if restitution is made.
Should I speak to the IRS alone?
No. You could accidentally incriminate yourself or make statements later used against you. Always consult a tax fraud lawyer before speaking with investigators.
Is there a difference between tax avoidance and tax evasion?
Yes. Tax avoidance is using legal strategies to minimize taxes (e.g., deductions, credits). Tax evasion is illegal (e.g., hiding income, falsifying records).
DON’T FIGHT ALONE
We are ready, eager, and determined to protect you.
DISCLAIMER
This content is for informational purposes only and does not constitute legal advice or create an attorney-client relationship. (See ABA Model Rule 1.2). Every case is different, and prior results do not guarantee a similar outcome. Consult an attorney licensed in your jurisdiction for advice on your individual situation.
The information presented here may not reflect the most current legal developments. We expressly disclaim all liability in respect to actions taken or not taken based on any or all the contents of this article. Communication through email or any other channel does not create an attorney-client relationship without an executed engagement letter.
We may work with affiliate lawyers in various states, also known as Local Counsel, depending on your case location. Laws and penalties vary by state and federal jurisdiction, and the specific facts of your situation will determine the best legal strategy.