The New York criminal defense attorneys and lawyers at Saland Law PC have successfully represented clients in a wide range of white collar crimes. While past success is no guarantee of future results, the former Manhattan prosecutors at Saland Law PC have had tremendous success representing clients in matters relating to New York State criminal tax fraud. In fact, we recently had a multi-million dollar tax fraud investigation by a NYC District Attorney’s Office dropped where our client failed to file returns for over a half a dozen years. Whether the case was prosecuted as a Grand Larceny or pursuant to the tax code as New York State Criminal Tax Fraud, the ramifications to the accused is enormous in both terms of incarceration and reputation. Because we strongly believe that education is the best means to avoid getting involved in crime, the following is an overview of Criminal Tax Fraud in the Fifth Degree (NYS Tax Law ､ 1802), Criminal Tax Fraud in the Fourth Degree (NYS Tax Law ､ 1803), Criminal Tax Fraud in the Third Degree (NYS Tax Law ､ 1804), Criminal Tax Fraud in the Second Degree (NYS Tax Law ､ 1805) and Criminal Tax Fraud in the First Degree (NYS Tax Law ､ 1806):
Definition of “Tax Fraud Acts” (NYS Tax Law ､ 1801)
(a) As used in this article, “Tax Fraud Act” means willfully engaging in an act or acts or willfully causing another to engage in an act or acts pursuant to which a person: (1) fails to make, render, sign, certify, or file any return or report required under this chapter or any regulation promulgated under this chapter within the time required by or under the provisions of this chapter or such regulation; (2) knowing that a return, report, statement or other document under this chapter contains any materially false or fraudulent information, or omits any material information, files or submits that return, report, statement or document with the state or any political subdivision of the state, or with any public office or public officer of the state or any political subdivision of the state; (3) knowingly supplies or submits materially false or fraudulent information in connection with any return, audit, investigation, or proceeding or fails to supply information within the time required by or under the provisions of this chapter or any regulation promulgated under this chapter; (4) engages in any scheme to defraud the state or a political subdivision of the state or a government instrumentality within the state by false or fraudulent pretenses, representations or promises as to any material matter, in connection with any tax imposed under this chapter or any matter under this chapter; (5) fails to remit any tax collected in the name of the state or on behalf of the state or any political subdivision of the state when such collection is required under this chapter; (6) fails to collect any tax required to be collected under articles twelve-A, eighteen, twenty, twenty-two, twenty-eight or twenty-eight-A of this chapter, or pursuant to the authority of article twenty-nine of this chapter; (7) with intent to evade any tax fails to pay that tax; or (8) issues an exemption certificate, interdistributor sales certificate, resale certificate, or any other document capable of evidencing a claim that taxes do not apply to a transaction, which he or she does not believe to be true and correct as to any material matter, which omits any material information, or which is false, fraudulent, or counterfeit.
(b) For purposes of this subdivision, “this chapter” includes any “related statute” or any “related income or earnings tax statute”, as defined in section eighteen hundred of this article.
(c) For purposes of this subdivision, the term “willfully” shall be defined to mean acting with either intent to defraud, intent to evade the payment of taxes or intent to avoid a requirement of this chapter, a lawful requirement of the commissioner or a known legal duty.
Read on for the actual offenses of Criminal Tax Fraud
Criminal Tax Fraud in the Fifth Degree (NYS Tax Law ､ 1802)
A person commits Criminal Tax Fraud in the Fifth Degree when he or she commits a tax fraud act. Criminal tax fraud in the fifth degree is a class A misdemeanor punishable by up to 1 year in jail.
Criminal Tax Fraud in the Fourth Degree (NYS Tax Law ､ 1803)
A person commits Criminal Tax Fraud in the Fourth Degree when he or she commits a tax fraud act or acts and, with the intent to evade any tax due under this chapter, or to defraud the state or any subdivision thereof, the person pays the state and/or a political subdivision of the state (whether by means of underpayment or receipt of refund or both), in a period of not more than one year in excess of three thousand dollars less than the tax liability that is due. Criminal Tax Fraud in the Fourth Degree is a class E felony punishable by up to 4 years in prison.
Criminal Tax Fraud in the Third Degree (NYS Tax Law ､ 1804)
A person commits Criminal Tax Fraud in the Third Degree when he or she commits a tax fraud act or acts and, with the intent to evade any tax due under this chapter, or to defraud the state or any political subdivision of the state, the person pays the state and/or a political subdivision of the state (whether by means of underpayment or receipt of refund or both), in a period of not more than one year in excess of ten thousand dollars less than the tax liability that is due. Criminal Tax Fraud in the Third Degree is a class D felony punishable by up to 7 years in prison.
Criminal Tax Fraud in the Second Degree (NYS Tax Law ､ 1805)
A person commits Criminal Tax Fraud in the Second Degree when he or she commits a tax fraud act or acts and, with the intent to evade any tax due under this chapter, or to defraud the state or any subdivision of the state, the person pays the state and/or a political subdivision of the state (whether by means of underpayment or receipt of refund or both), in a period of not more than one year in excess of fifty thousand dollars less than the tax liability that is due. Criminal Tax Fraud in the Second Degree is a class C felony punishable by up to 15 years in prison.
Criminal Tax Fraud in the First Degree (NYS Tax Law ､ 1806)
A person commits criminal tax fraud in the first degree when he or she commits a tax fraud act or acts and, with the intent to evade any tax due under this chapter, or to defraud the state or any subdivision of the state, the person pays the state and/or a political subdivision of the state (whether by means of underpayment or receipt of refund or both), in a period of not more than one year in excess of one million dollars less than the tax liability that is due. Criminal tax fraud in the first degree is a class B felony punishable by up to 25 years in prison.
Aggregation (NYS Tax Law ､ 1807)
For purposes of this article, the payments due and not paid under article one of this chapter pursuant to a common scheme or plan or due and not paid, within one year, may be charged in a single count, and the amount of underpaid tax liability incurred, within one year, may be aggregated in a single count.
The above statutes relating to Criminal Tax Fraud can be confusing . Therefore, it is not recommended that you proceed in a tax case without the assistance of a criminal defense attorney who will be able to navigate you through the muddy waters of the criminal justice system.
Saland Law PC is a New York white collar criminal defense firm founded by two former Manhattan prosecutors. You can follow our legal updates and analysis on Twitter at DefenseLawyerNY.