The Internal Revenue Service considers a tax fraud to be an extremely serious crime and actively prosecutes many California residents for tax fraud every day. Many taxpayers also unwittingly assist the IRS in building a case against them by talking to the IRS too much before consulting with an experienced California tax law attorney. A tax fraud conviction can result in large tax penalties, a felony criminal record and incarceration. Tax fraud is the evasion of taxes achieved by failing to file a return, failing to pay taxes, or intentionally filing false returns.
A federal grand jury recently indicted 55 Californians allegedly involved in a large tax fraud scheme that sought over $250 million in refunds. Authorities say that several of the 55 defendants were charged with conspiracy to defraud the government, a crime that can carry a decade of prison time. Others involved in the scheme are charged with making false claims and face five year sentences.
The defendants allegedly ran two companies that assisted people in filing false returns for a up to a $10,000 fee and a percentage of the false refunds received.
Included in the indictment are the company owners and also the tax preparers and attorneys that worked for them. Customers were allegedly told that they were receiving money from “a secret government account” and it is unclear whether the customers were aware of the illegality of the scheme. Authorities have not yet arrested all of those allegedly involved in the tax fraud scheme and it is unclear whether some of the defendants will be offered plea deals for testifying against the company owners.
Source: Los Angeles Times, “55 indicted in alleged $250-million tax fraud scheme,” Oct. 3, 2011