Tax Crimes and the Statute of Limitations

In Criminal, White Collar by Jason FreemanLeave a Comment

The statute of limitations for most criminal tax offenses is governed by 26 U.S.C. § 6531.  Section 6531 provides as follows:

No person shall be prosecuted, tried, or punished for any of the various offenses arising under the internal revenue laws unless the indictment is found or the information instituted within 3 years next after the commission of the offense, except that the period of limitations shall be 6 years –

(1) for offenses involving the defrauding or attempting to defraud the United States or any agency thereof, whether by conspiracy or not, and in any manner;

(2) for the offense of willfully attempting in any manner to evade or defeat any tax or the payment thereof;

(3) for the offense of willfully aiding or assisting in, or procuring, counseling, or advising, the preparation or presentation under, or in connection with any matter arising under, the internal revenue laws, of a false or fraudulent return, affidavit, claim, or document (whether or not such falsity or fraud is with the knowledge or consent of the person authorized or required to present such return, affidavit, claim, or document);

(4) for the offense of willfully failing to pay any tax, or make any return (other than a return required under authority of part III of subchapter A of chapter 61) at the time or times required by law or regulations;

(5) for offenses described in sections 7206(1) and 7207 (relating to false statements and fraudulent documents);

(6) for the offense described in section 7212(a) (relating to intimidation of officers and employees of the United States);

(7) for offenses described in section 7214(a) committed by officers and employees of the United States; and

(8) for offenses arising under section 371 of Title 18 of the United States Code, where the object of the conspiracy is to attempt in any manner to evade or defeat any tax or the payment thereof.

26 U.S.C. § 6531.

The structure of the statute sets forth a general three-year statute of limitations for Title 26 offenses. However, that general rule is largely swallowed up by the “exception,” which provides that a six-year statute of limitations applies to a number of listed tax offenses.  Moreover, while the statute of limitations generally begins to run at the point in time that an offense is completed, Toussie v. United States, 397 U.S. 112, 115 (1970), that does not mean that all tax offenses are considered completed for statute of limitations purposes upon the filing of a tax return.  E.g., United States v. Thompson, 518 F.3d 832, 856-57 (10th Cir. 2008), cert. denied, 129 S. Ct. 487 (2008); see also United States v. Goodyear, 649 F.2d 226, 228 (4th Cir. 1981) (crime considered complete at time of false statement to IRS agent, not when false return is filed); United States v. Irby, 703 F.3d 280 (5th Cir. 2012) (limitations period began from affirmative acts after filing return).

Below is a chart setting forth the statute of limitations that applies to common tax crime charges:

Description of Offense Code Section Statute of Limitations Code Section
Tax Evasion26 U.S.C. § 72016 years26 U.S.C. § 6531(2)
Failure to Collect, Account For or Pay Over26 U.S.C. § 72026 years26 U.S.C. § 6531(4)
Failure to Pay Tax26 U.S.C. § 72036 years26 U.S.C. § 6531(4)
Failure to File a Return26 U.S.C. § 72036 years26 U.S.C. § 6531(4)
Failure to Keep Records26 U.S.C. § 72033 years26 U.S.C. § 6531
Failure to Supply Information26 U.S.C. § 72033 years26 U.S.C. § 6531
Supplying False Withholding Exemption Certificate26 U.S.C. § 72053 years26 U.S.C. § 6531
Filing a False Tax Return26 U.S.C. § 7206(1)6 years26 U.S.C. § 6531(5)
Aid or Assist in Preparation or Presentation of False Tax Return26 U.S.C. § 7206(2)6 years  U.S.C. § 6531(3)
Deliver or Disclose False Document26 U.S.C. § 72076 years26 U.S.C. § 6531(5)
Attempt to Interfere With Administration of Internal Revenue Laws26 U.S.C. § 7212(a)6 years26 U.S.C. § 6531(6)
Conspiracy to Commit Tax Evasion18 U.S.C. § 3716 years26 U.S.C. § 6531(8)
Conspiracy to Defraud the Internal Revenue Service18 U.S.C. § 3716 years26 U.S.C. § 6531(1)
False Claim for Refund18 U.S.C. § 286/2875 years18 U.S.C. § 3282
False Statement18 U.S.C. § 10015 years18 U.S.C. § 3282

(Table listings from DOJ Tax Manual.)

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