A BRIEF LESSON ON THE PURPOSE OF CRIMINAL LAW AS IT PERTAINS TO TAX CRIMES

 

Criminal and civil litigation are two separate issues.  In a civil suit, the basic questions are (1) how much and (2) what remedies are necessary to compensate the plaintiff for his loss.  In a criminal case, however, the questions are (1) has the defendant injured society and (2) what sentence should she get.

 

In criminal litigation, the question of reform is important.  Some individuals believe that reform has a valid purpose, others do not think the government should spend money reforming criminals.  However, criminologists regard reform as the most worthwhile goal of punishment. There is such a high level of recidivism among criminals, it is obvious that reform in our society is not working.  It is possible too that the very idea of reform runs counter to the concept of incarceration.

 

Of course, one goal of criminal law is restraint.  And we can all agree that some individuals need to be restrained for the protection of society. (Although it is difficult in the case of tax crimes to understand what restraint as to do with the protection of society from the "willful" non-filing of a piece of paper).

 

Another goal of criminal law is to get retribution for the crime against society.  Of course, in a morally just world, retribution is not morally justifiable although our bureaucrats believe that the imprisonment of "tax criminals" is necessary to scare the middle class and make them keep paying their "fair share."  Our leaders are attempting to show the rest of us that we will go to prison if we don't file returns.  There is certainly an opposition to this viewpoint also. Critics maintain that most prospective criminal defendants are unaware of the sentences that courts do impose and those who are aware are not the type who calculate possible loss as well as potential gain.  The actual crime rate shows that deterrence is really ineffective.   So the purpose of our criminal tax system is to scare the multitude and make them continue to volunteer.

 

In order to effect a criminal tax case, the government must come up with either an information or an indictment. These are statements listing the alleged crimes.  Once the indictment is in place, the defendant will be required to show up in court for an arraignment.  The arraignment is the meeting with the judge in which the defendant can plead guilty or not guilty.

 

If the defendant pleads "not guilty," the judge will set up a time for the trial.  During the time before the trial, it is very important for the defendant to prepare his case and to file his pre-trial motions.  The most common pre-trial motions involve motions for discovery to get evidence that the government intends to use against the defendant.

 

During the pre-trial planning stage, you will also need to think about the questions you want to ask the jury during the voir-dire.  Remember that you get to provide questions for the jury selection process and these questions are very important.  If the court makes a mistake in jury selection, there is a possibility of a mistrial once the case makes it through the court of appeals.

 

Actually, the most important part of the trial will involve the theory of your defense.  In other words, why did you do what you did?  Are you "willful?"  If not, why not?  The instructions that the judge gives to the jury will make the difference between the win and the loss of your case.

 

You must be aware that most individuals who go to trial in criminal tax cases are convicted.  The reason for this is that juries are generally made up of individuals who do not understand tax law, the Constitution, or their rights; and they routinely convict patriots not for the crime of "willfulness," but for the non-crime of "not paying their perceived fair share."

 

So if you go to trial, be sure of the theory of your defense and be prepared with voir-dire questions, pre-trial motions and jury instructions.  If you lose you shouldn't have much trouble coming up with at least one appeal issue as many district court judges make significant mistakes.

 

If you have taken an adverse position against the IRS, the principal point to remember is that you may have to subject yourself to a criminal investigation and a criminal case and retribution from society. You may lose even though you know that you are right; and you may come into contact with the criminal justice system.  Therefore, you must know your rights, you must be familiar with criminal law in the case of a criminal attack.   Good luck in your endeavors.

 

 

IRS VS. THE PEOPLE----THE CRIMINAL STATISTICS

 

 

            The Income tax, Title 26 contains criminal provisions to encourage individuals to voluntarily file returns.  The IRS has to successfully prosecute individuals each year in order to continue to encourage the voluntary filing of returns. Therefore, the Criminal Investigation Division uses selective prosecution in order to continue to encourage voluntary compliance.

 

            From 1978 to 1988, the number of tax returns filed each year increased from 136 million to 194 million, but the number of returns that the IRS examined each year declined from about 2 million to about 1 million.  However, during the same period of time, the CID recommended prosecutions against approximately 3,000 people per year.  The IRS gets convictions in about 87 percent of the cases they prosecute. The IRS gets great news coverage of their victories for maximum deterrent value.

 

            Every CID investigation is a potential criminal prosecution.  The CID storm trooper doesn't determine a correct tax and he doesn't collect a tax.   His function is to get information to use in a successful criminal investigation.

 

            The CID can handle only a certain number of criminal investigations each year.  The IRS proceeds civilly to gather the information it needs and gets information from "taxpayers" who voluntarily give them data.  If a civil agent suspects there might be some sort of criminal potential in a case, he can turn the case over to the CID at any point and all the information he has collected civilly will be used against the "taxpayer" by the CID.  This simple fact means that the cooperative individual, in many, many situations will be in a much worse situation than the individual who realizes that he doesn't have to voluntarily submit to IRS audits and questioning.  Individuals, who voluntarily give information to the government, do not have a valid complaint, if the government proceeds to use that information against them criminally.

 

            Revenue Agents who are examining fraud are instructed to perfect the indications of fraud to ensure they are substantial (IRM 4231).  A revenue agent may gather information from a "taxpayer" without any indication that a criminal referral is currently under consideration.  The referring "civil agent" may obtain evidence that will make the IRS' criminal case a snap by the "taxpayer's" own admission through extracts or copies of the "taxpayer's" records before a referral to CID is made.

 

            The following table summarizes IRS Criminal Action in the year 1988:

 

            Guilty plea         2,074

            Convicted             249

            Acquitted              74

            Dismissed             205

            Total               2,769

 

            So you can see that in 1988, the IRS nailed about 3,000 people criminally and about 2,000 of them pled guilty.  A very small percentage went to trial but the IRS won three out of four cases that went to trial.

 

            Why does the IRS have such a good win record?  Probably for the following reasons:

 

            1.  The IRS can gather all the information they need civilly before notifying a "taxpayer" that he is under criminal investigation.  Anything a "taxpayer" puts on a tax return will be used against him by the CID; if they want to use it.  The IRS gets most of the information they need for criminal cases when the "taxpayer" voluntarily provides it to them.

 

            2.  The tax laws are so complicated that the IRS can develop a criminal case on just about anyone.  For example, most people that file returns have the returns prepared professionally, and then they sign the returns even though they do not understand the contents of the return.  This means that each year, literally millions of individuals commit perjury because they attest to the truthfulness of a return they do not understand.

 

            3.  The IRS has millions of victims to choose from, so it isn't too hard to develop 3,000 criminal cases each year that are sure winners.

 

            4.  Individuals on juries do not understand the tax laws and they convict defendants because they are angry they are paying such high taxes and the defendant seems not to be paying them. But quite frankly, in many tax evasion cases, the evidence is so complicated that the jury probably doesn't know for sure if the guy committed a crime or not.

 

 

            5.  Federal judges are held in awe by jury members. They sit up on a bench in the front of a room wearing priestly garb and they wrongly inform the juries that they have no right to judge the law of the case.

 

     6.  Juries are so brainwashed that they refuse to believe that individuals could actually believe they are not required to file a return.

 

 

            Are you upset, after reading this article that you have been lead to believe you are required to file returns and give the IRS information they can use against you in criminal tax cases?  Don't be too mad, because the IRS tells you the truth.  Just look in the 1040 Instruction Booklet.  The IRS says that we have a voluntary tax system.  They also say, in their Privacy Act Notice that you must file returns for any tax you are liable for, but there is no statute that makes you or anyone else liable for the tax.  Furthermore, they give you a Miranda Type of warning.  The IRS clearly tells you that you are not required to file returns; but beware, because, in hundreds of cases a year, the IRS, the prosecutors, and the judges pretend that individuals are required to file returns and waive their Fifth Amendment Rights; and that is why innocent individuals are currently sitting in federal pens for not volunteering to waive their Fifth Amendment Rights.    Think about it!!!!!!!!!