CRIMINAL PROCDEDURES:  IRS STYLE

            As a general rule tax crimes are covered by a three-year statute of limitations. (IRC Section 6531); however, in the two most common offenses alleged of individuals in the Freedom Movement: failure to file and tax evasion; the statute of limitations is six years from the date the return was due or the date the return was filed, whichever is later. (U.S. v. Habig, 390 U.S. 222).

            The IRS may nail you by either an indictment or an information.  An information is a written statement of the essential facts, which constitute the offense against the "taxpayer."  A misdemeanor may by charged by information and willful failure to file is a misdemeanor.

            However, a felony must be charged with an indictment. Tax Evasion is a felony.  Remember that an indictment is an accusation from the Grand Jury.

            If you are attacked criminally by the IRS, you have a right to get information from them.  The Jencks Act (18 USC Section 3500) allows you to inspect and examine statements of the Government.  You are permitted to use these documents to impeach the government witnesses' credibility without the necessity of laying preliminary foundation.

            The IRS will use search and seizure methods many times in gathering information.  Remember that the Fourth Amendment of the Constitution prohibits unreasonable searches and seizures and that no warrant can be issued without reasonable cause.  Rule 41 of the Federal Rules of Criminal Procedure will help you attack the IRS' Search Warrant if it comes after you.

            Remember that the IRS has the burden of proof in a criminal case; and if the CID contacts you, you don't have to speak with them.

How Does the Bankruptcy Court Define Tax Return?

      Those of you who are planning to bankrupt taxes in the future need to be very careful that you have correctly filed a tax return.  If you do not file a tax return, your taxes will never be dischargeable in a Chapter 7 Bankruptcy.  The law varies on this issue, but is safest to file returns and sign them.  In Carapella v. U.S., 84 B.R. 779 (Fla) 1988, the court ruled that information in a tax court proceeding may be deemed the equivalent of filing a return.  In Arenson v I.R.S. 145 B.R. 310 (D. Neb 1992); the court ruled that filing an amended return without having filied the original return, does not constitute the filing of a return.  In Levinson v. U.S. 969 F2d 260 (7th Cir. 1992), the court ruled that an unsigned return does not constitute a valid return. In the case of In re Lowrie, 162 B.R. 864 (Bkrtcy.D.Nev.1994), the court ruled that the signing of a Form 1902-B admitting the existence of income and the resulting tax liability was sufficient to constitute a return.  But a court has also ruled that a document is a tax return only if it purports to be a return is sworn to as such, and gives an honest and genuine attempt to satisfy the return filing requirement.  See In re Eastwood, 164 B.R. 989   (Bkrtcy.E.D u.Ark. 1994).  In the case of Schmitt v. U.S., 140 B.R. 571 (W.D. Okla 1992), the court ruled that a tax protestor's addition of objectionable words to his tax return rendered the return invalid and unfiled.  Since the law is so complex on this issue, it is a good idea to be sure that you file returns either in person or by certified mail, return receipt.  If you mail returns, be sure to put each return in a separate envelope.  If you hand deliver a copy of the return to a local revenue officer, the return may not be deemed filed.  Therefore, even if the revenue officer helps you fill out the returns, you should send an original copy to the service center or file one with the District Director's office.