Tags: offshore | tax | sentences | lighter

Sentences Lighter for Offshore Tax Cheats

By    |   Monday, 06 May 2013 12:59 PM

Tax evaders who hide money offshore get more lenient punishment than other tax cheaters, according to a comparison of Internal Revenue Service statistics, despite a crackdown that began in 2009 on hidden financial accounts.

The data, compiled by U.S. Justice Department attorney Jack Townsend, showed the average prison sentence for people hiding money offshore is about half of that given in other tax cases, reports The Wall Street Journal. Further, judges often give people hiding money offshore shorter sentences than federal guidelines recommend.

At least 71 taxpayers have been charged with crimes since the intense crackdown started four years ago. People hiding money offshore were sentenced to an average of less than 15 months in custody, but people involved in tax-shelter schemes got an average of 30 months behind bars. About 75 percent of those charged in offshore account cases have pleaded guilty, the IRS information showed.

Townsend, who practices in Houston, called the differences "troubling, because cheating is cheating."

The penalties may be lighter for the offshore cases because of the IRS' limited-amnesty programs, which allow taxpayers to admit to having secret accounts in exchange for protection from criminal prosecution. In addition, defendants pay huge penalties when found guilty, including having to give up half the highest balance in an account.

Critics say that many defendants have circumstances that are like those of the people protected under the IRS' limited amnesty program, but are prosecuted harshly.

"Judges seem to feel it's unfair to put these defendants in jail when thousands of people just like them are being processed civilly," said Edward Robbins, a lawyer from Los Angeles.

But the amnesty program doesn't mean those hiding money offshore are getting off cheaply.

So far, more than 39,000 taxpayers who have been admitted to the amnesty program have paid more than $5.5 billion to resolve their cases, with an estimated $5 billion still to come.




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Tax evaders who hide money offshore get more lenient punishment than other tax cheaters, according to a comparison of Internal Revenue Service statistics, despite a crackdown that began in 2009 on hidden financial accounts.
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2013-59-06
Monday, 06 May 2013 12:59 PM
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