Individual Properly Convicted of Filing False Tax Returns; Enhanced Sentence for Obstruction of Justice Unwarranted (Feb. 13, 2012)

Individual Properly Convicted of Filing False Tax Returns; Enhanced Sentence for Obstruction of Justice Unwarranted (Feb. 13, 2012)

Tax court is not a very friendly place to end up.  Even on appeal, oftentimes taxpayers’ tax crimes convictions are upheld.  This week, the U.S. Court of Appeals ruled that an
individual was properly convicted of filing false tax returns; however,
his sentence was vacated and remanded because it
was improperly enhanced for obstruction of justice.  It was found that the trial court did not violate the individual’s confrontation rights
by admitting documents that showed he was on notice
that his interpretation of the tax law concerning wages was incorrect
and, therefore, that his refusal to comply with the
law was willful.

Moreover,
the individual’s contention that his right to speedy trial was violated
was without merit because he waived his
speedy-trial claim by failing to assert the claim
prior to trial. Further, the delay was caused due to the individual’s
pre-trial
motions and he failed to demonstrate significant
prejudice from the delay. Further, the jury was properly instructed
with
respect to the willfulness requirement of the
individual’s offenses. The district court properly defined both “wages” and “employee,” and instructed the jury that it should consider the individual’s subjective state of mind when determining whether he acted
willfully.

In
addition, the evidence was sufficient to support the individual’s
conviction because the individual received compensation
that he had earlier reported as wages for the year at
issue. Therefore, a rational juror could conclude that he was aware
that his earnings constituted wages and that his tax
forms asserting to the contrary were knowingly false. Further, the
individual
failed to show that the judge had an interest in the
outcome of his case or that his statements or rulings were the result
of actual bias.

However,
the sentence imposed on the individual was vacated and remanded for
resentencing because the trial court erred in
applying a two-level enhancement for obstruction of
justice. The individual had conceded that the Supreme Court never
declared
the civil judgment against him void and he was only
speculating on why the Court refused to take his appeal. Therefore, his
statement did not constitute the type of false
testimony that warranted a sentence enhancement.                

By |2014-07-10T17:47:35+00:00February 14th, 2012|Legal Issues, Tax and Auditing|0 Comments

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