<removeps-groups[at]yahoo.com> wrote in message
news:aec029eb-4883-405b-a7e0-60e4749edb34[at]c19g2000prf.googlegroups.com...
- quote -

Willful can usually be satisfied if the activity generating the excluded
income is itself illegal. However, that by itself may not be enough. Note
that there's not necessarily an attempt to evade if the illegally sourced
income is laundered (and therefore reported) through an activity that itself
reports the income as part of its gross receipts.

There has always been a debate under 26 USC 6103 as to whether it permits
the IRS to disclose non-tax violations (i.e. illegal occupations) in
situations where there is no tax violation. 6103(i)(6) is the only section
governing IRS-initiated disclosures of this type - and simply says "may"
disclose; not "should" or "must." However, it appears that disclosure can
only be to other FEDERAL agencies; disclosure to states must have a
tax-adminstration purpose - 6103(d) - with the exception of imminent death
to a person.

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Alan wrote:
- quote -

I should have added, that the full article of the above excerpt
can be found at:
http://www.allbusiness.com/legal/laws/1015344-1.html

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Bill Brown wrote:
- quote -

intent. This falls under Section 7201 of the IRC. My answers
relate to that section and how the courts have responded.

Sec. 7201. Attempt to evade or defeat tax
Any person who willfully attempts in any manner to evade or
defeat any tax imposed by this title or the payment thereof
shall, in addition to other penalties provided by law, be guilty
of a felony and, upon conviction thereof, shall be fined not more
than $100,000 ($500,000 in the case of a corporation), or
imprisoned not more than 5 years, or both, together with the
costs of prosecution.

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Alan wrote:
- quote -

Spies vs US, 317 US 492
Sansone vs US, 380 US 343
Cheek vs US, 498 US 192

Also see US vs Cor-Bon Custom Bullet, 287 F.3d 576 (6th Circuit)
Certiorari to SCOTUS denied.

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On Jun 24, 6:49*pm, Alan <sfcnm-...[at]yahoo.com> wrote:
- quote -

Criminal tax fraud is a felony. Civil tax fraud is not a crime of any
sort.

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Alan <sfcnm-mtm[at]yahoo.com> wrote:

- quote -

It depends upon the level an manner of the tax evasion.
The IRS refers to these things as "Badges of Fraud".

Dick

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

removeps-groups[at]yahoo.com wrote:
- quote -

bright-line test for willful intent. Each case stands on its own.

Also from my index file, an excerpt from an American Law Review
article. I don't have the citations.

b. Affirmative Act Constituting Evasion

The Supreme Court has long interpreted [section] 7201 to require
a positive attempt to evade or defeat any tax. (84) It requires
more than mere "passive neglect." (85) Thus, an act to evade tax
must be a commission rather than an omission. (86) The
"affirmative act" language has been broadly construed (87) and
includes: (i) filing false returns; (88) (ii) keeping two sets of
books; (89) (iii) making false entries or alterations; (90) (iv)
making false invoices or documents; (91) (v) destroying books or
records; (92) (vi) concealing assets or covering up sources of
income; (vii) handling one's affairs to avoid making records
usually kept for transactions; and (viii) conduct where the
likely effect would be to mislead or conceal. (93)

Generally, affirmative acts associated with evasion involve
concealment of the taxpayer's ability to pay taxes or the removal
of assets from the reach of the IRS. (94) An affirmative act may
be inferred even if the actions undertaken can be attributed to
motivations other than the intent to evade taxes. (95) Moreover,
the argument that the methods a taxpayer used were not likely to
mislead or conceal and, thus, do not constitute an affirmative
act of evasion is not a viable defense. (96)

c. Willfulness

The Supreme Court has defined "willfulness" as the voluntary,
intentional violation of a known legal duty. (97) The willfulness
requirement is closely related to the affirmative act requirement
because evidence of affirmative acts is often used to show
willfulness. (98)

To prove willfulness, the government must show the taxpayer had a
specific intent to commit the violation. (99) The government must
demonstrate more than mere carelessness on the part of the
defendant, (100) though it need not prove bad faith. (101) Thus,
even an unreasonable misunderstanding of the law may negate a
finding of willfulness. (102) The defendant's subjective belief
regarding the applicability of a legal duty is a question of
fact. (103)

Some courts have held that "proof of willfulness usually must be
accomplished by means of circumstantial evidence." (104)
Willfulness can be inferred from both the surrounding
circumstances and the defendant's affirmative acts of evasion.
(105) When applied, this inference often blurs the distinction
between willfulness and affirmative acts. (106)

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

Bill Brown wrote:
- quote -


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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Jun 24, 2:25�pm, "removeps-gro...[at]yahoo.com" <removeps-
gro...[at]yahoo.com> wrote:
- quote -

Typically, the IRS will not try to make the case unless there are
three years of such omission. Thye consider once an accident, twice
kind of iffy and three times fraud.

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Jun 23, 8:17*pm, Bill Brown <brow...[at]longwood.edu> wrote:

- quote -

So there has to be a "a preponderance of evidence" that the fraud was
"willful". What might be valid examples of this? Surely there must
be some statutes or other rules to keep the government from extending
their reach, because every omission of income could be construed as
willful. How would one respond to the IRS in writing or in court to
explain that it was not willful?

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Jun 23, 7:37*pm, Alan <sfcnm-...[at]yahoo.com> wrote I keep the following quote from an appeals court ruling in my
- quote -

The burden for imposing civil fraud penalties is "a preponderance of
evidence," not the much more stringent "beyond a reasonable doubt."

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

removeps-groups[at]yahoo.com wrote:
- quote -

index file:

To establish the crime of federal tax evasion as charged in the
indictment the prosecution must prove beyond a reasonable doubt
that defendant willfully attempted to evade or defeat a tax due
the government. This involves the specific intent to evade the
tax, and some willful commission, affirmative action or omission
by defendant in furtherance of that intent.

The key word in the above is "willful." This means that the acts
of the accused were intentional and/or deliberate. The
government is allowed to infer such willfulness from the actual
conduct of the accused or acts performed or not performed by the
accused or from any other conduct which could mislead or conceal.

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

The statute of limitations for the IRS to begin proceedings is 3 years
in general, and 6 years if income understated by more than 25%, and
forever if filing a false/fraudulent return with the intent to evade
tax. Is there a definition of "intent to evade tax"? Say my income
is 100k and I forget to report 1k (say on a foreign account, or
incorrectly figuring the cost basis of a stock). How does the IRS
determine if there was an intent to evade tax or if you really just
forgot?

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >