Types of Tax Fraud
International Tax Whistleblower Representation
Tax fraud is the willful violation of one’s legal responsibility to pay mandatory taxes to the government. The IRS may impose civil fraud penalties of up to seventy-five percent on amounts due and owing as a result of civil tax fraud. If the evidence of a criminal intent to defraud the government is strong enough, the government may also bring criminal charges that could result in additional fines and penalties.
The IRS Tax Whistleblower Program will pay a reward on all civil, but not criminal, fines and penalties assessed against the taxpayer as well as a reward for the amount of tax actually underpaid as a result of the fraud.
Each year, the federal government is defrauded out of hundreds of billions of dollars in tax revenue. In 2005, the U.S. government estimated that approximately $345 billion, roughly 14% of federal revenues, went unpaid as a result of tax fraud. This estimate remains the most recent one available.
Common Types of Tax Fraud
Common types of tax fraud schemes include:
- Off shore accounts fraud
- Corporate tax fraud
- Employment tax fraud
- Money laundering tax fraud
- Abusive tax shelters
Indicators of Fraud
There are a variety of actions which may indicate a clear intention to willfully underpay required taxes:
- Failing to file a tax return
- Deliberately underreporting or omitting income
- Claiming false deductions
- Hiding or transferring assets or income
- Overstating the amount of deductions
- Making false entries in records
- Failing to report income earned in a stock exchange
- Maintaining two sets of books
- Misusing trusts
- Abusing charitable deductions
Tax Fraud versus Tax Underpayment
Under the IRS Tax Whistleblower Program, a reward can be collected for any form of tax underpayment, whether it is the result of fraud, reckless disregard, innocent mistake, or some other level of intent. Sophisticated taxpayers often take overly aggressive positions on their tax returns in the hope that the IRS will not challenge their tax position. While many of these overaggressive positions are not fraudulent, they often result in large scale underpayment of taxes.
Experienced Tax Whistleblower Representation
The tax whistleblower attorneys at Kenney & McCafferty represent whistleblowers, both domestically and abroad, who have knowledge of tax fraud committed against the federal government. Under the tax whistleblower program, informants may receive between 15% and 30% of any money recovered by the IRS in taxes, interest, and penalties.
These cases are highly complex and require the assistance of experienced attorneys in order to ensure that you maximize your tax reward. Our firm includes a forensic accountant who is a former IRS Revenue Agent and a former Department of Justice tax prosecutor who can help you build your case. We will work with the IRS throughout the entire investigation to ensure that you receive the highest possible reward allowable by law. Over the last ten years, our cases have resulted in recoveries of hundreds of millions of dollars by the IRS leading to lucrative rewards for our clients.
If you have knowledge of tax fraud totaling more than $2 million, please contact our tax whistleblower attorneys today. Kenney & McCafferty will consult with you about your case, without obligation. All communications with Kenney & McCafferty attorneys regarding your case are confidential and protected by attorney-client privilege.
