With April 15 fast approaching, some Newark residents are likely scrambling to get their tax returns together by the deadline. It can be all too easy to put this chore off until the last minute, especially for residents who run a business and have extensive records to pore over and sort through. However, when rushing to prepare a tax return leads to errors and omissions, anyone could find themselves facing charges of filing a false tax return.
One local man who operated a business buying and selling ancient coins over the Internet has recently been charged for allegedly underreporting income from the operation. He started the business in 2006 and claimed almost $311,000 in income for that year, a bit more the following year and around $232,000 in 2008. His wife and daughter both helped him run the coin-dealing business.
Allegedly, the man's tax returns from those three years underreported the business income and he is accused of providing false information to his tax preparer. A grand jury has indicted him on federal tax charges in connection with the allegedly false returns. He faces a possible nine years in prison and up to $750,000 in fines.
Tax fraud is a serious charge and even mere negligent underreporting can land a Newark resident in legal trouble. Because the IRS cannot audit every federal return and has to rely to a large extent on the honor system, the agency pushes for harsh penalties against those defendants who are charged, and publicizes convictions as a way of pressuring other taxpayers to comply voluntarily with the tax code.
It is difficult enough for the average New Jersey business owner to prepare a tax return, given the complexity of the code. Those who face criminal charges related to tax fraud should consider whether defending against the charges is an endeavor they want to take upon themselves, or whether a tax fraud defense professional could help ensure their case is handled effectively.
Source: NJ.com, "Hackensack-based coin dealer indicted on federal tax charges," Dan Ivers, April 2, 2013