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Orange County Criminal Defense Attorney
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Tax Evasion Charges in Orange County

If you’re afraid of an IRS audit, you have a lot of company. Lots of people are afraid of being audited by the IRS. Some of them even fear going to prison if they make a big mistake on their tax returns. In fact, the fear of an IRS audit keeps a lot of people honest. Afraid of legal trouble, they ensure that they file their taxes before the cutoff date.

Do a lot of people go to prison for tax reasons? In reality, very few tax payers actually go to prison for tax evasion. But that doesn’t mean the IRS is idle. The agency generally goes after people who understate their income or assets on their tax returns. As a rule, the IRS targets taxpayers who decide to:

  • Lie about their income (underreporting),
  • Lie about their credits,
  • Lie about their deductions (overstating them), and
  • Not file their tax returns.

“What if I can’t afford to pay my taxes? What will happen to me then?” The IRS does not pursue very many people for tax evasion on the grounds that they cannot pay their taxes. On the other hand, if you’re hiding income and assets that can be used to pay the IRS what you owe, that’s a different story. The IRS does not take kindly to people who intentionally avoid paying taxes by concealing income and assets.

When an IRS Audit is Initiated

Usually, an IRS audit is started and if the IRS finds something fishy, what follows is a tax evasion case. This typically happens when the IRS is conducting an audit and it finds errors that the taxpayer knowingly and intentionally made. In this scenario, there’s usually a pattern of immoral behavior – the error amounts were not only large, but they had been occurring over a period of several years.

The single biggest issue is unreported income. This is what usually gets taxpayers into trouble and places them under a criminal investigation. This has become a big issue in the gig economy space – a gig worker will fail to report income to the IRS from a side hustle. The penalties for tax evasion are found under Title 26 USC § 7201. Tax evasion is punishable by up to 5 years in prison, or by a fine not to exceed $250,000, or by a fine and imprisonment, plus the prosecution expenses.

Facing federal charges for tax evasion in Orange County? Contact our office at once to schedule a free case evaluation.