Last month, Mike Sorrentino—formerly “The Situation” on the reality series Jersey Shore—pleaded not guilty to charges of tax evasion allegedly involving $8.9 million between 2010 and 2012. Sorrentino, along with his brother Marc, were specifically charged with failing to report income on both business and personal income tax returns.
According to the IRS, the Sorrentino brothers had been taking cash payments for booking fees and depositing proceeds into various accounts without claiming the income. The IRS also alleges the brothers gave inaccurate information to an accounting firm they used to manage their tax returns. They then allegedly altered tax records when a federal grand jury subpoenaed them last year.
Tax fraud is obviously a serious crime, and the IRS is serious about tracking down offenders and imposing appropriate penalties. Usually, the IRS has a pretty good idea of how to determine whether an individual is engaging in tax fraud, but that is not always the case. In some cases, the IRS mistakes tax negligence with tax fraud.
The difference is that tax negligence involves careless mistakes on tax returns while tax fraud is intentional. Because fraud often has to be proven by circumstantial evidence, it can sometimes involve a bit of guesswork as to the taxpayer or tax preparers’ mental state. In other cases, the IRS may correctly track down tax fraud, but make mistakes as to which transactions were truly fraudulent. Whatever the case may be, it is important for those who are accused of tax fraud to work with an experienced attorney in building a solid defense case. The best time to begin the process is when one first learns about a pending audit. Getting an early start can help one get a better handle on the case.
Source: North Jersey.com,Former ‘Jersey Shore’ star ‘The Situation’ pleads not guilty to tax fraud,” Jeff Green, September 24, 2014.