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Tax Fraud in New York


To many New Yorkers, the IRS is scary, and some people worry that when they make mistakes on their taxes, the IRS will prosecute them criminally for doing so. Since tax forms are complicated, the IRS doesn’t consider simple errors that might cause someone to underpay on their taxes to be tax fraud, however. While the person who has made such an error will have to pay what they should have paid to the IRS, mistakes are not a crime.

Tax fraud instead often involves a purposeful effort to hide income in order to underpay taxes. For example, a waiter who doesn’t report all of their earned tips on their income tax return has committed tax fraud, as has a small business owner who doesn’t report all of their income or inflates their losses.

Other examples of activities that might be prosecuted as tax fraud include a person’s failing to file tax returns at all. In some cases, people lie about how large their family is and the number of dependents they have. In still others, a person may try to claim credits to which they are not entitled.

White collar crimes such as tax fraud can expose those who are charged to significant penalties, including fines and imprisonment. Those who learn that they are being investigated by the IRS for tax fraud may want to seek the help of a criminal defense attorney as soon as possible. An attorney may be able to negotiate in order to reach an agreement in which the client’s case will not be prosecuted in exchange for payment in full. In the event such an agreement is not possible, an attorney may still be able to negotiate a plea to a lesser charge or one that avoids incarceration for the client.