From the Tax Law Offices of David W. Klasing -Texas Man Sentenced to Federal Prison for Tax Evasion

IRVINE, Calif., July 11, 2024 /PRNewswire/ -- According to a Department of Justice press release, a Texas man was recently sentenced to serve more than three years in federal prison after being convicted of federal income tax evasion. This story highlights the severe consequences that can arise from intentional tax noncompliance. If you have failed to file a tax return for one or more years, or have taken a position on a tax return that could not be supported upon examination, it is in your best interest to consult with an experienced tax defense attorney to discuss your options to get right with the government.

Defendant Failed to File Tax Returns, Dodged the IRS Upon Exam

Court records reveal that John L. Petrone, a resident of Texas, was sentenced to 37 months in prison for evading taxes on income that he earned from his kratom (an herbal extract) business. Petrone did not file individual income tax returns or pay income taxes from 2014 to 2019, causing a tax loss of over $529,000. He attempted to evade taxes by operating under different business names, dealing in cash, and using business accounts for personal expenses. Petrone also lied to the IRS during an examination and failed to pay employment taxes as required by law.

In addition to being sentenced to serve 37 months in federal prison, the defendant was also ordered to serve three years of supervised release, commencing upon the end of his physical incarceration. Lastly, he was ordered to pay nearly $530,000 in restitution.

Serious Penalties for Tax Evasion

This case highlights the severe consequences of tax evasion and failing to comply with other federal tax laws. Petrone's actions resulted in significant legal repercussions, including prison time, supervised release, and substantial restitution. The penalties underscore the importance of compliance with tax laws and the serious consequences of attempting to evade them.

If you have failed to file a federal or state income tax return for one or more years, or have lied on your tax filings, you should strongly consider speaking with an experienced and seasoned tax lawyer. Together, you will discuss your potential exposures and establish a plan to bring you into compliance.

If you have failed to file a tax return for one or more years or have taken a position on a tax return that could not be supported upon an IRS or state tax authority audit, eggshell audit, reverse eggshell audit, or criminal tax investigation, it is in your best interest to contact an experienced tax defense attorney to determine your best route back into federal or state tax compliance without facing criminal prosecution.

Note:  As long as a taxpayer that has willfully committed tax crimes (potentially including non-filed foreign information returns coupled with affirmative evasion of U.S. income tax on offshore income) self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosure before the IRS has started an audit or criminal tax investigation / prosecution, the taxpayer can ordinarily be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously often receive a break on the civil penalties that would otherwise apply. 

It is imperative that you hire an experienced and reputable criminal tax defense attorney to take you through the voluntary disclosure process.  Only an Attorney has the Attorney Client Privilege and Work Product Privileges that will prevent the very professional that you hire from being potentially being forced to become a witness against you, especially where they prepared the returns that need to be amended, in a subsequent criminal tax audit, investigation or prosecution.

Moreover, only an Attorney can enter you into a voluntary disclosure without engaging in the unauthorized practice of law (a crime in itself). Only an Attorney trained in Criminal Tax Defense fully understands the risks and rewards involved in voluntary disclosures and how to protect you if you do not qualify for a voluntary disclosure.

As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, Kovel CPAs and EAs, our firm provides a one stop shop to efficiently achieve the optimal and predictable results that simultaneously protect your liberty and your net worth. See our Testimonials to see what our clients have to say about us!

Here is a link to our YouTube channel: click here!

See our Criminal Tax Law Q and A Library

See our Audit Representation Q and A Library

Public Contact: Dave Klasing Esq. M.S.-Tax CPA, [email protected]

SOURCE Tax Law Offices of David W. Klasing, PC