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Virginia Tax Fraud and Tax Evasion Laws

Taxes--no one wants to pay them, but failure to do so will land you in a great deal of trouble. A tax is a charge by the government on the income of an individual, corporation or trust, as well as the value of an estate or gift. The objective in assessing tax is to generate revenue to be used for the needs of the public. A tax is not a voluntary payment but an enforced contribution exacted pursuant to legislative authority.

In Virginia, tax fraud and tax evasion are serious crimes that carry steep penalties and significant life-long repercussions. These crimes generally fall under one of two categories:

  • Filing a false or fraudulent return;
  • Failure to file a tax return with intent to evade.

Penalties For Tax Fraud And Tax Evasion

Penalties for these crimes can be civil and criminal. State and federal governments aggressively use Virginia criminal laws to enforce tax violations. The civil penalty for filing a false or fraudulent return, or for failing or refusing to file a return with intent to evade the tax is 100 percent of the correct tax. In addition, criminal penalties of imprisonment for up to one (1) year or a fine of up to $2,500, or both, can apply in cases of fraud and failure to file.

Dealing With The Internal Revenue Service

In addition to state law penalties, individuals committing tax fraud can also be investigated by the Internal Revenue Service (IRS).

The following table highlights the main provisions of Virginia's tax fraud and tax evasion laws.

See also Financial Crimes, White Collar Crimes, and Fraud.

Code Section

§ 58.1-308

What is Prohibited Failing to file your tax returns, underreporting your income, or knowingly claiming excess deductions.
Penalties

Criminal penalties: Imprisonment for up to one (1) year or a fine of up to $2,500, or both

Civil penalties: Repayment of 100 percent of the correct tax plus interest.

Possible Associated Crimes Embezzlement, forgery, fraud, falsifying business records, grand theft and more.

Where to Report Suspected Tax Fraud

Virginia Department of Taxation: (804) 367-8031

Common Types of Tax Fraud/Tax Evasion

  • Underreporting income,
  • Overestimating expenses or deductions
  • Failing to collect employment taxes,
  • Making false statements to investigators,
  • Violating employer withholding requirements,
  • Not filing a yearly tax return.

Tax law is a highly technical and demanding area of the law, involving complex and ever changing rules, as well as numerous accounting principles. Because Virginia's tax laws can sometimes get extremely complicated, it may also be a good idea to consult an experienced criminal defense or a tax attorney, if you have questions about your specific situation.

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