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Criminal Tax Evasion, doesn’t just apply to the big fish. You don’t hear about the little ones because they get swallowed whole.

Tax evasion is a felony punishable by up to five years imprisonment and a $100,000 fine.  Severe civil sanctions can also be imposed.  A felony conviction for tax evasion will most likely lead to disciplinary action and could end your law enforcement career.

“I have testified as an expert witness on behalf of the defense in a case involving criminal tax evasion. While we were successful in resolving the case in favor of the taxpayer it was a costly and lengthy process.  If it sounds to good to be true “Don’t do it! ...Steve Sims, EA”

Note: If you are being investigated for criminal tax evasion hire a tax attorney (specializing in criminal tax evasion)...immediately! Even if your going to plead guilty.

Here are answers to questions law enforcement personnel commonly ask about taxes.

What Income is Taxable?

Law enforcement officers, like all taxpayers, must pay the correct amount of tax on all income they receive unless that income is specifically excluded by the Internal Revenue Code.  Reportable income includes your salary as a law enforcement officer as well as any income you earn from outside employment, such as being a security guard or a retail sales person.  Other sources of taxable income might include workmen’s compensation payments, disability income, performance bonuses or monetary awards. 

How Should You Report This Income?

You must report the total amount of income you receive regardless if you received this income in the form of cash, check or in exchange for services.

What Happens If You Do Not Report Your Income?

Failure to report all income can result in severe civil and/or criminal penalties.  For example, in Fiscal Year 2008, the average defendant sentenced for tax violations was incarcerated in over 81 percent of all cases.  The average time of imprisonment was two years.  For law enforcement officers, a tax conviction could impede your ability to continue in a law enforcement position.  Criminal prosecution for tax violations, at a minimum, can impair an officer's credibility as a witness in any future criminal proceedings and could lead to disciplinary action, including dismissal.

For more information click here:

https://www.irs.gov/compliance/criminal-investigation/enforcing-the-laws-and-paying-taxes-is-there-a-connection

If it sounds too good to be true, it probably is!" Seek professional advice from the IRS or a tax professional before you subscribe to any scheme that offers exemption from your obligation as a United States Citizen to pay taxes. Buying into a tax evasion scheme can be very costly.

Tax Scams: How to Recognize and Avoid Them

To help the public recognize and avoid abusive tax schemes, the IRS offers an abundance of educational materials. Participating in an illegal scheme to avoid paying taxes can result in imprisonment and fines, as well as the repayment of taxes owed with penalties and interest. Education is the best way to avoid the pitfalls of these “too good to be true” tax scams.

Tax Scams/Consumer Alerts

https://www.irs.gov/businesses/small-businesses-self-employed/tax-scams-how-to-report-them

For a quick look at how to recognize a “tax avoidance scheme “ click here:

https://www.irs.gov/pub/irs-pdf/p3995.pdf

steve@stevesimsea.com