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Civil vs criminal tax fraud: What do you fall under?

On Behalf of | Jul 1, 2024 | Criminal/Civil Tax Litigation |

Tax fraud is a big deal and can get you in big trouble with the law. In the state of New York, understanding the distinction between civil and criminal tax fraud may help you personally to ensure you are in compliance with the law.

Civil tax fraud

The police may arrest you for civil tax fraud for underreporting income, overstating deductions or failing to file tax returns. If you face a conviction for this charge, you might have to pay large fines, penalties and additional money on top of what you owe in taxes.

Criminal tax fraud

Criminal tax fraud involves willful and intentional evasion of taxes through illegal means, such as falsifying documents or intentionally hiding income. Criminal tax fraud is a serious offense that can result in criminal prosecution, fines and even imprisonment.

Key differences between civil and criminal tax fraud

The key differences between criminal and civil tax fraud illuminate their implications under state law.

  • Intent: Civil tax fraud typically involves negligence or recklessness, while criminal tax fraud requires willful intent to evade taxes.
  • Penalties: Civil tax fraud penalties include monetary fines and penalties, whereas criminal tax fraud penalties can include imprisonment.
  • Burden of proof: In civil cases, it’s up to the IRS to prove that fraud happened with enough evidence. In criminal cases, the burden of proof is higher, requiring proof beyond a reasonable doubt.

Understanding tax law can be challenging, but it is important to know the difference between civil and criminal tax evasion. If you’re worried about your taxes or you’re facing fraud accusations, it’s smart to talk to a good tax lawyer. They can protect your rights and help you deal with any legal problems promptly.