New York Tax Law § 1805: Criminal Tax Fraud in the Second Degree

New York Tax Law § 1805 defines Criminal Tax Fraud in the Second Degree. It is a more serious offense than Criminal Tax Fraud in the Third or Fourth Degrees and is charged when the amount of tax liability involved is greater than $50,000. Under this section of the law, a person is guilty of Criminal Tax Fraud in the Second Degree if they intentionally and with the intent to evade paying taxes, engage in any of the following activities:

• Failing to file a return, or filing a false or fraudulent return.
• Failing to pay taxes that are due and owing.
• Filing a false or fraudulent claim for a refund of taxes.
• Aiding or assisting another person in committing any of the above offenses.

Criminal Tax Fraud in the Second Degree is a class C felony.

The law requires that the defendant acted with the intent to evade taxes to be found guilty of this offense. This means that the prosecution must prove beyond a reasonable doubt that the defendant knew that they were committing tax fraud and intended to avoid paying taxes. In some cases, the evidence may include financial documents, tax returns, and witness testimony.

People v. Stavropoulos, 129 A.D.3d 904 (2d Dept. 2015). In People v. Stavropoulos, the defendant, a tax preparer, was charged with Criminal Tax Fraud in the Second Degree under New York Tax Law § 1805. The prosecution alleged that the defendant filed false tax returns on behalf of her clients, resulting in more than $50,000 in tax liability.

At trial, the prosecution presented evidence of the defendant's activities, including false deductions, credits, and business expenses claimed on her clients' returns. The prosecution also presented evidence of the defendant's training as a tax preparer and her knowledge of tax law. The defendant argued that she was not aware that the tax returns were false and that her clients provided her with inaccurate information. However, the jury rejected the defendant's arguments and found her guilty of Criminal Tax Fraud in the Second Degree.

People v. Basile, 177 A.D.3d 1096 (2d Dept. 2019). In People v. Basile, the defendant, a businessman, was charged with Criminal Tax Fraud in the Second Degree under New York Tax Law § 1805. The prosecution alleged that the defendant failed to pay taxes on more than $1.5 million in income over a period of several years. The prosecution presented evidence of the defendant's income and his failure to report it on his tax returns. The prosecution also presented evidence of the defendant's use of offshore bank accounts to conceal his income.

The defendant argued that he was not aware of his tax obligations and that he had relied on his accountant to handle his taxes. However, the jury rejected the defendant's arguments and found him guilty of Criminal Tax Fraud in the Second Degree. The court sentenced the defendant to prison, as well as to pay restitution.

1. Criminal tax fraud in the fifth degree. Section 1802
2. Criminal tax fraud in the fourth degree. Section 1803
3. Criminal tax fraud in the third degree. Section 1804
4. Criminal tax fraud in the first degree. Section 1806

If found guilty of criminal tax fraud in the second degree, the individual may face a class C felony charge. The penalty for this offense may include imprisonment for up to 15 years and fines of up to $100,000 or double the amount of taxes evaded, whichever is greater.

A person commits criminal tax fraud in the second degree when he or she commits a tax fraud act or acts and, with the intent to evade any tax due under this chapter, or to defraud the state or any subdivision of the state, the person pays the state and/or a political subdivision of the state (whether by means of underpayment or receipt of refund or both), in a period of not more than one year in excess of fifty thousand dollars less than the tax liability that is due.  Criminal tax fraud in the second degree is a class C felony.

If you are charged with Criminal Tax Fraud in the Second Degree under New York Tax Law § 1805, it is important to seek the assistance of an experienced criminal attorney serving New York. The penalties for this offense can be severe, including significant fines and prison time, as well as the potential loss of professional licenses and reputational damage. A skilled criminal attorney in New York can help you understand your legal options and develop a defense strategy tailored to your specific circumstances. Contact Stephen Bilkis & Associates at 800.696.9529 to schedule a free, no obligation consultation regarding your case. We represent clients in the following locations: Manhattan, Nassau County, Queens, Bronx, Brooklyn, Long Island, Staten Island, Suffolk County, and Westchester County.