Tax Evasion & Fraud Defense

Tax evasion is considered a white-collar crime, with a conviction resulting in heavy fines and even prison time in Mississippi.

The offense is sometimes called “tax fraud”. While the two terms are often used interchangeably to describe the underpayment of taxes, the offense under the criminal code is termed “tax evasion”.

If you’ve been charged with tax evasion, the consequences of a conviction can stretch far beyond a fine and back payment of taxes. To protect your legal rights and limit the impact on your future, speak to a tax evasion defense lawyer at Rushing & Guice, PLLC.

What is tax fraud?

Tax fraud is defined by the Mississippi Department of Revenue (DOR) in the following way:

“… deliberate deception put into practice in order to get unfair or unlawful gain, advantage or benefits. It can mean intentionally misrepresenting the truth in order to obtain something of value by persuading someone else with false information. When it comes to taxes, it means “cheating” by intentionally not paying your fair share of taxes.”

• The Department of Revenue also provides some common examples of tax fraud:
• Intentionally failing to file all types of tax returns
• Failing to report all income received
• Claiming to be a resident of another state while living in MS
• Overstating expenses to reduce income
• Making false or fraudulent claims for refunds
• Under-reporting sales
• Selling beer or tobacco without paying the excise tax
• Doing business without registering for a permit or license
• Operating a business using someone else’s name to avoid business and income taxes
• Avoiding excise tax on fuel by using off-road diesel in the fuel tanks of motor vehicles for use on highways
• Preparing returns, schedules, documents, books, and records with erroneous, non-substantiated, and misleading figures
• Payment of cash wages to employees to evade MS withholding tax
• Collecting and not remitting sales taxes

Tax fraud or tax evasion should not be confused with the term “tax avoidance”, which is considered a lawful tax planning strategy to minimize one’s tax liability.

What is the difference between tax fraud and tax negligence in Mississippi?

Tax fraud or tax evasion is a federal crime that requires “willful” actions from an individual. A person must intentionally take action to cheat the tax system to be convicted of tax evasion under federal law—and prosecutors must prove “willful” actions in these cases to achieve a conviction.

Because the tax code is complex and difficult to follow without the right advice, people do make honest mistakes through negligence rather than deceit. The results can appear the same despite the difference in intentions.

Negligence may still be punished by the tax authorities but it usually won’t result in a criminal conviction for tax evasion.

What is tax evasion in Mississippi?

Tax evasion is defined by the DOR as the willful attempt to circumvent the tax laws through misrepresentation or deceit.

Types of tax evasion

Most commonly, tax evasion involves the following types of actions:

• Falsifying income statements
• Failure to file tax returns
• Concealment of assets
• Keeping inadequate records
• Falsifying tax returns
• Understating income
• Claiming excess deductions
• Failure to cooperate with the IRS
• Failing to report cash dealings
• Making fraudulent statements
• Failure to make estimated tax payments

Tax evasion and dealing with the IRS

Any individual suspected of tax evasion will come under the spotlight of the tax authorities. The Internal Revenue Service Criminal Investigation Division is likely to assign a case officer to thoroughly investigate your financial records.

Dealing with the IRS can be an extremely stressful time for the accused. It often helps to be able to rely on the support and legal guidance of a qualified tax evasion lawyer. A skilled tax evasion lawyer can handle the communications with the IRS and ensure that your legal rights are protected and that no missteps or inadvisable statements are made.

Many people make tax errors and fall foul of the complexities of the tax code. Remember, negligence is quite different from tax fraud or tax evasion. Even if irregularities are found, a skilled tax evasion lawyer can often make a case for the misstep to be considered negligence rather than criminal wrongdoing.

Sometimes, the tax authorities begin an audit and find other potential offenses to the matter(s) they are investigating—another reason why hiring a qualified criminal defense lawyer makes sense.

What are the penalties for tax evasion in Mississippi?

A conviction for tax evasion in Mississippi can result in hundreds of thousands of dollars in fines and payments of back taxes—and even a term of incarceration of up to five years. Whether a misdemeanor or felony conviction, this will remain on your criminal record and appear in background checks for life.

The precise penalties will depend on the facts of the case and the strength of your arguments in defense of the charges. A skilled tax evasion lawyer can often push for the case to be dismissed or at least reduce the penalties you face—and the subsequent impact on your future.

What is sales tax evasion in Mississippi?

The tax code covers many different taxes and evasion of any type of tax can be considered a criminal offense.

For instance, sales tax evasion by a business is treated seriously—whether it’s selling items “under the table” for cash (“off the books”) or underreporting sales revenues. If you are suspected of sales tax evasion, an investigation may be conducted into your affairs. Like with any other type of tax evasion, this can lead to significant penalties.

Because of the complexities of such cases and the potential for a significant impact on your future, it’s often advisable to discuss your situation with a seasoned tax evasion lawyer as a first step.

Contact a tax evasion lawyer at Rushing & Guice, PLLC for legal advice and assistance if you’re in the Biloxi area of Mississippi and you or a loved one has been accused of evading tax.