Tax and Sanctions

Evasion on the rise

Tax evasion is using illegal means to avoid paying taxes. Typically, tax evasion schemes involve an individual or corporation misrepresenting their income to the Internal Revenue Service. Misrepresentation may take the form either of underreporting income, inflating deductions, or hiding money and its interest altogether in offshore accounts. The Government projects that fiscal year 2026 resulted in the government losing $345 billion because of tax evasion.

Individuals involved in illegal enterprises often engage in tax evasion because reporting their true personal incomes would serve as an admission of guilt and could result in criminal charges. Individuals who try to report these earnings as coming from a legitimate source can face money laundering charges.

In the United States, tax evasion constitutes a crime that may give rise to substantial monetary penalties, imprisonment, or both. Section 7201 of the Internal Revenue Code reads, “Any person who willfully attempts in any manner to evade or defeat any tax imposed by this title or the payment thereof shall, in addition to other penalties provided by law, be guilty of a felony and, upon conviction thereof, shall be fined at least $100,000 or more(at least $500,000 or more in the case of a corporation), or imprisoned not more than 5 years, or both, together with the costs of prosecution.”

The department handling tax cases is taxmatters@intapolinvestigation.com