Sunday, February 10, 2008

Injunctive Relief to Avoid Tax Crimes

Tax Indictments seem to always be in the news around April 15th (see, e.g, here).  So it is interesting to see tax issues coming up this time of year - a time when people are often in the preliminary stages of preparing materials for filing their tax returns. There, of course, was the Wesley Snipes prosecution that ended with a conviction for 3 misdemeanors and acquittals on the remaining counts (see here), a case that is now set for sentencing on April, 24, 2008.

But it is interesting to see the tax division using injunctions to stop individuals from preparing tax returns. According to the DOJ, "Since 2001, the Justice Department has obtained injunctions against more than 305 tax preparers and tax-fraud promoters."  Most recently, the following injunctions were issued -

  • A federal court today permanently barred a Memphis, Tenn., woman from preparing federal income tax returns for others. (see here)
  • A Texas man barred from preparing tax returns for others (see here)
  • Federal Court bars Charlotte man from preparing tax returns (see here)

One has to applaud the tax division for trying to stop criminal conduct prior to it occurring. The use of a civil remedy to avoid criminality should also be applauded. As opposed to waiting for a crime to occur and then have to spend tax dollars on the prosecution, the DOJ is using injunctive relief to promote compliance with the law.

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