2 important lessons from recent income tax evasion case

The United States government recently accused an East Coast man of stealing money from his business. According to court documents, the accused had business interests in three businesses that operated largely in cash. The prosecution claims the accused took cash from these businesses and deposited it directly into his personal accounts.

These allegations are not uncommon. However, two important lessons from this particular case include:

  1. Government uses classic move to catch a criminal. In this case, as noted above the government accused the businessman of taking money from his business. How did the government finally catch the businessman? He did not include the cash on his income tax filings and thus failed to pay income taxes on the money he took. As a result, he faces criminal charges for tax evasion. This tactic may ring a bell. The government has used similar methods to take down mafia members and other criminals. Takeaway: the government will follow the money. Criminal charges may occur if the numbers do not add up.
  2. Business as usual with a slight modification. This case is recent and moved forward during the current coronavirus pandemic. This meant that social distancing, stay at home and shelter in place orders impacted the case. How did the court continue in these current conditions? Through the use of technology. A majority of the hearing was held over video conferencing. The takeaway here: the government continues to move forward with criminal tax charges. If facing an investigation or charges, it is a good idea to act to protect your legal interests.

After facing the evidence, the accused chose to accept a plea deal. As a result, he pled guilty to one count of tax evasion and will face sentencing in the fall. The judge could sentence him to up to five years imprisonment and a $250,000 fine.

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