Category Archives: Financial Crimes

Can I Go To Jail For Not Paying State Taxes In North Carolina?

Springtime in North Carolina brings a number of stressors, including filing tax returns. Although this year’s state and federal tax deadlines have been extended, you’re still responsible for taking care of both returns, federal and state, as well as paying tax amounts. North Carolina is also considering eliminating tax penalties due to the COVID-19 pandemic.

When you don’t complete your tax returns and fail to pay state taxes, you’re actually breaking the law. However, the penalties will depend on whether you made an honest mistake, or you deliberately committed fraud to avoid paying taxes.

Willful Failure

Tax Evasion and Financial Crimes DefenseIt is possible to receive jail time—and incur a criminal record—for not paying your state taxes.

North Carolina General Statutes Ch. 105 addresses the intentional failure to pay one’s state income taxes. According to the statute, “willful failure” is a Class 1 misdemeanor, which can include jail time of as much as 120 days, as well as a discretionary fine.

The penalties for willful failure include:

  • 5% penalty per month, up to a maximum of 25% of the balance due
  • 10% late penalty
  • 20% “collection assistance” fee if you don’t pay within 90 days
  • An additional 50% “fraud penalty” upon conviction

Penalties can also include tax liens against properties and a damaged credit record.

Tax preparers who participate in willful failure or other misleading tax schemes can also be charged. Filing a “frivolous return” also incurs penalties, including a $500 fine.

Intentional Fraud

Tax fraud or tax evasion is the intentional act of submitting false and/or misleading information on a tax return in order to change the amount owed. Both the federal government and the state of North Carolina have penalties for purposely committing tax fraud.

In addition to the above sanctions, any actions that lead to under-paying state income taxes is a Class H felony, which carries potential jail time from 4 to 24 months. A conviction will also bring substantial financial penalties including fines and interest, as well as an additional 50% penalty of the defrauded amount.

Mistakes

It happens and is correctible. Making a mistake is not the same as a willful failure or intentionally committing fraud.

If you’ve made a mistake on your tax return, it’s easy to file an amended one. For a 2019 return, you’ll fill in the circle on Form D-400 indicating that you’re filing an amended return. Complete and attach the Form D-400 Schedule AM for a North Carolina Amended Schedule to the front of Form D-400.  Then attach all the required schedules and supporting forms.

Call Dewey P. Brinkley For Financial Crimes Defense

You really can go to jail for as long as 120 days for willful failure to file your North Carolina tax return.

If you’ve been charged with willful failure, tax evasion, or any financial crimes, you’ll need the help of a financial crimes defense attorney immediately to avoid a potential jail sentence, fines, and penalties, along with a permanent criminal record.

Call the law offices of Dewey P. Brinkley immediately for a free initial consultation to discuss your case at (919) 832-0307. You can also email us at dewey@deweypbrinkleylaw.com, or use our online contact form.

 

How Embezzlement and Theft are Different?

You might be thinking that embezzlement and theft are one and the same, but they aren’t. While theft is stealing something that doesn’t belong to you, embezzlement is also more of a planned type of theft, and has the added element of violated trust.

What Is Embezzlement?

In an employment or other position of financial responsibility, you may be entrusted with money or property, and have permission to handle them in the course of your job or other position. Misusing your position of trust to steal or misappropriate money or property and convert it to your own elevates theft and embezzlement.

The crime occurs in a number of familiar settings, with the most common scenario a worker stealing money, inventory, or office supplies from their employer. While you may not be arrested for the odd ballpoint you forgot that put in your pocket and take home, embezzlement can also take the form of:

How Does Embezzlement Differ From Theft?

  • Altering employee time records
  • Adding extra to a company expense account
  • Depositing customer or vendor checks into a personal account, or moving money into one
  • Altering company books to conceal stolen, misappropriated, or loss amounts
  • “Borrowing” money from a company cash register
  • Over-charging for a product and keeping the difference
  • Adding a phony employee to the company payroll
  • Accepting kickbacks and bribes

Additionally, money or property that is entrusted to you and is mishandled is considered embezzlement, including:

  • Improperly using someone else’s Social Security money, i.e., relative or child
  • Creating a credit card or check “kiting” scheme (writing bad checks and “floating” them)
  • Using a Ponzi scheme to steal funds
  • Using a client’s settlement amount to pay for operating expenses
  • “Borrowing” funds from a civic organization, nonprofit or other organization
  • Selling a property and keeping the proceeds without notifying heirs

Although embezzlement is usually handled at the state level, should a government employee is involved, or government funds, the federal government will be involved.

Overtime As Embezzlement

Many people are dedicated to their job, and work longer hours. For some, it may be a requirement. But for others, working overtime may constitute embezzlement under certain circumstances.

Of course, if you’re working the overtime to bring in extra money, and not setting off any alarms, there isn’t much cause for concern. However, other indicators in addition to overtime may raise suspicions of possible embezzlement. This would include issues with company financial accounts, including accounts that are missing or disorganized records that make account audits difficult if not impossible.

For an individual who spends a lot of time at the office, including weekends and holidays, and uses company resources may be doing so for their own benefit (i.e., running a business or other money-making plan.) If the individual charges the company for “overtime,” the individual is defrauding the company out of money and work he or she allegedly completed.

Another method is when an individual claims to work overtime, but doesn’t appear anywhere on security footage at the time he or she claims to have worked.

This is not to say that everyone working overtime is suspect. If a company suspects fraud through overtime, it will look for other signs of possible misconduct that indicate embezzlement.

Penalties For Embezzlement in North Carolina

These depend on who committed the embezzlement and how much the individual embezzled.

  • Officers or agents, clerks, or employees at a corporation who embezzle over $100,000 are charged with a Class C felony, with a possible jail sentence of 58-73 months in prison. Anything under $100,000 is considered a Class H felony with a possible jail sentence of 5 to 6 months in prison and “community punishment.”
  • Treasurers of any charitable organizations who embezzle over $100,000 are charged with a Class C felony, with a possible sentence of 58-73 months in prison. Anything under $100,000 is considered a Class H felony with a possible jail sentence of 5 to 6 months in prison and “community punishment.”
  • Railroad officers embezzling over $100,000 are charged with a Class C felony, with a possible sentence of 58-73 months in prison. Anything under $100,000 is considered a Class F felony with a possible jail sentence of 13 to 16 months in prison.
  • Public officials and public employees, including state and government workers embezzling over $100,000 are charged with a Class C felony, with a possible sentence of 58-73 months in prison. Anything under $100,000 is considered a Class F felony with a possible jail sentence of 13 to 16 months in prison.

In addition to criminal court charges, the company or individual from whom the money or property was embezzled can also sue you in civil court. The individual or company can treat you like a debtor once they get a judgment. They can garnish your wages, put a lien on your house (or force you to sell it) and levy your bank accounts.

Dewey P. Brinkley Is Ready To Defend You

Embezzlement is a serious crime with far-reaching consequences. If you’ve been accused of or charged with embezzlement, you need someone to defend you against the charges and in court—quickly.

Dewey P. Brinkley is an experienced criminal defense attorney in Raleigh, NC who understands the criminal justice system, and how to defend you against embezzlement charges.

Call Dewey P. Brinkley today for a free initial consultation to discuss your case at (919) 832-0307. You can also email us at dewey@deweypbrinkleylaw.com, or use our online contact form.