Federal Tax Evasion Defense In San Antonio

If the government suspects you of tax wrongdoing, you may be the subject of a civil IRS audit or a criminal tax investigation. A civil tax audit will occur if there is suspicion that you failed to file tax returns or failed to pay the correct amount of tax for:

Estate tax
Payroll tax/withholding of employee taxes
Income tax

A civil audit may also begin because your tax return was chosen at random for review or because you were reported to the IRS by a disgruntled ex-employee, business competitor or ex-spouse.

Tax audits and criminal tax evasion cases can also arise from failure to report all income or claiming false deductions. Criminal tax cases can also result from tax shelters or other tax issues that the IRS considers an abuse, tax shelter or a scam to evade taxes.

If you are concerned about a tax matter or an upcoming IRS audit, or you are facing possible criminal charges for tax evasion, contact the San Antonio criminal defense attorneys at the Law Offices of Robert I. Kahn, or call me at (210) 225-6600 or toll-free at (888) 232-7313.

Avoid Criminal Charges for Tax Evasion

If an IRS auditor suspects personal or corporate tax fraud, they may refer your case to IRS criminal investigators. If you willfully cheated the government of its money by evading taxes, you face criminal prosecution that could result in serious fines and a prison sentence (with the length of the sentence related to the amount of taxes you should have paid). Tax evasion charges can result in jail time even for a person with no prior criminal convictions.

It is crucial to speak to an experienced tax crime defense lawyer to ensure your rights are protected. As a San Antonio criminal lawyer, I strive to have the criminal tax investigations closed without prosecution or to win the case if the government proceeds with criminal charges.

Resolving Charges of Tax Evasion for Unreported Offshore Accounts

In March 2009, the IRS implemented an amnesty program for people with unreported offshore bank accounts. This program has now ended. If you have unreported income from an offshore account, you may still benefit from participating in the voluntary disclosure program. However, talk to a criminal tax attorney before you do so. As your defense lawyer, I will work to minimize the risk of the criminal prosecution.

Tax avoidance

Tax avoidance is the legal utilization of the tax regime to one's own advantage, to reduce the amount of tax that is payable by means that are within the law. The United States Supreme Court has stated that "The legal right of an individual to decrease the amount of what would otherwise be his taxes or altogether avoid them, by means which the law permits, cannot be doubted." See Gregory v. Helvering. Examples of tax avoidance include:

Country of residence

One way a person or company may lower taxes is by changing one's tax residence to a tax haven, such as Monaco, or by becoming a perpetual traveler. Some countries, such as the U.S., tax their citizens, permanent residents, and companies on all their worldwide income. In these cases, taxation cannot be avoided by simply transferring assets or moving abroad.

The United States is unlike many other countries in that its citizens and permanent residents are subject to U.S. federal income tax on their worldwide income even if they reside temporarily or permanently outside the United States. U.S. citizens therefore cannot avoid U.S. taxes simply by emigrating. According to Forbes magazine some nationals choose to give up their United States citizenship rather than be subject to the U.S. tax system; however, U.S. citizens who reside (or spend long periods of time) outside the U.S. may be able to exclude some salaried income earned overseas (but not other types of income unless specified in a bilateral tax treaty) from income in computing the U.S. federal income tax. The 2008 limit on the amount that can be excluded was US$87,000.

Double taxation

Most countries impose taxes on income earned or gains realized within that country regardless of the country of residence of the person or firm. Most countries have entered into bilateral double taxation treaties with many other countries to avoid taxing nonresidents twice—once where the income is earned and again in the country of residence (and perhaps, for US citizens, taxed yet again in the country of citizenship) -- however, there are relatively few double-taxation treaties with countries regarded as tax havens. To avoid tax, it is usually not enough to simply move one's assets to a tax haven. One must also personally move to a tax haven (and, for U.S. nationals, renounce one's citizenship) to avoid tax.

Legal entities

Without changing country of residence (or, if a U.S. citizen, giving up one's citizenship), personal taxation may be legally avoided by creation of a separate legal entity to which one's property is donated. The separate legal entity is often a company, trust, or foundation. Assets are transferred to the new company or trust so that gains may be realized, or income earned, within this legal entity rather than earned by the original owner. If assets are later transferred back to an individual, then capital gains taxes would apply on all profits.

The company/trust/foundation may also be able to avoid corporate taxation if incorporated in an offshore jurisdiction. Although income tax would still be due on any salary or dividend drawn from the legal entity. For a settlor (creator of a trust) to avoid tax there may be restrictions on the type, purpose and beneficiaries of the trust. For example, the settlor of the trust may not be allowed to be a trustee or even a beneficiary and may thus lose control of the assets transferred and/or may be unable to benefit from them.

Legal vagueness

Tax results depend on definitions of legal terms which are usually vague. For example, vagueness of the distinction between "business expenses" and "personal expenses" is of much concern for taxpayers and tax authorities. More generally, any term of tax law, has a vague penumbra, and is a potential source of tax avoidance

Keeping Legal Services Within Your Reach

I offer a free initial consultation on any criminal or municipal defense matter. If you are facing charges or an investigation, or there is a warrant out for your arrest, you can come to me to discuss your concerns with no further obligation. Call now at (210) 225-6600.

 

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