Federal criminal tax prosecutions are declining across the country, but the consequences of potential years in prison from one of these cases could not be higher. Counsel at Evergreen Attorneys are experienced defenders who will help you fight for your freedom when facing a federal tax prosecution.

The top federal criminal tax defense attorneys know that often times people get into these cases because the tax code is too complicated for ordinary people to understand. That can give rise to a specific defense called a Cheek defense in federal criminal tax cases.  Whether you received a troubling letter from the IRS, a grand jury subpoena, or an indictment, do not hesitate to contact the capable federal criminal tax defense lawyers at Evergreen Attorneys today.

Ignorance of the law: is it a defense in tax cases?

Thomas Jefferson said, “Ignorance of the law is no excuse in any country. If it were, the laws would lose their effect, because it can always be pretended.”

In the United States there is a working assumption that individuals should possess a general awareness of what is considered ‘wrong’ or illegal and have a common knowledge of local, state, and federal laws. Also, individuals should be held responsible for breaking a law, whether or not they have knowledge of the law. However, in regard to ignorance of the law and the Internal Revenue Code—our nation’s tax laws—the subject and application of ‘ignorance’ as well as ‘willful intent’ is worth further review.

Willfulness at the heart of tax prosecutions

According to the U.S. Department of Justice Criminal Resource Manual, “the term ‘willfully’ means no more than that the forbidden act was done deliberately and with knowledge, and does not require proof of intent.” Therefore, “an act is done ‘willfully’ if done voluntarily and intentionally and with the specific intent to do something the law forbids. There is no requirement that the government show evil intent on the part of a defendant in order to prove that the act was done ‘willfully.’”

This is an important starting point for understanding the willfulness defense in tax cases because this document is literally the handbook that prosecutors use in federal criminal tax cases to try and take your freedom away.

In addition, the Manual of Model Criminal Jury Instructions states that, “in order to prove that the defendant acted ‘willfully,’ the government must prove beyond reasonable doubt that the defendant knew tax law imposed a duty on him or her, and the defendant intentionally and voluntarily violated that duty.”

The Cheek Defense In Federal Criminal Tax Cases

One of the most notable cases involving the argument of willful intent is Cheek v. United States, 498 U.S. 192 (1991). In Cheek, the defendant argued that he had a good-faith belief that he was not violating the law—a position now commonly known as the “Cheek Defense.”

Petitioner Cheek did not file tax returns over a seven-year period and was prosecuted for willful tax evasion. He was charged with six counts of willfully failing to file a federal income tax return in violation of Internal Revenue Code § 7203 (Attempt to Evade or Defeat Tax) and three counts of willfully attempting to evade his income taxes in violation of § 7201 (Willful Failure to File Return, Supply Information, or Pay Tax).

While Cheek admitted that he did not file his returns, he testified that he didn’t act willfully because he sincerely believed that the tax laws were being unconstitutionally enforced and therefore his actions were lawful. Cheek argued that based upon his own research and through the indoctrination of an organization that promoted the unconstitutionality of the federal tax system, that he couldn’t have acted with the willfulness required to commit the offenses for which he was accused. In accordance with this held belief, Cheek also filed several suits against his employer and the Internal Revenue Service alleging that his employer was wrongfully withholding taxes from his wages, that it violated the 16th Amendment, and he sought refunds from taxes withheld from his earnings.

The Supreme Court held that “a good-faith misunderstanding of the law or a good-faith belief that the defendant was not violating the law prevents a finding that the defendant acted willfully, whether or not the misunderstanding or belief was objectively reasonable.”

The Court also stated that:

The general rule that ignorance of the law or a mistake of the law is no defense to criminal prosecution is deeply rooted in the American legal system. Based on the notion that the law is definite and knowable, the common law presumed that every person knew the law. This common law rule has been applied by the Court in numerous cases construing criminal statutes.

The proliferation of statutes and regulations has sometimes made it difficult for the average citizen to know and comprehend the extent of the duties and obligations imposed by tax laws. Congress has accordingly softened the impact of the common law presumption by making specific intent to violate the law an element of certain federal criminal tax offenses. Thus, the Court almost 60 years ago interpreted the statutory term ‘willfully’ as used in the federal criminal tax statues as carving out an exception to the traditional rule. This special tenement of criminal tax offense is largely due to the complexity of the tax laws.

Winning a Cheek Defense

After the U.S. Supreme Court approved of the willfulness defense in the Cheek case, many lower courts struggled to articulate what was required. Today, it is clear that in order to prevail on a Cheek defense, a defendant must show that he had a good-faith belief that he was not violating the applicable tax law or statute. To put it differently, the Assistant United States Attorney must prove that a federal criminal tax defendant both 1) knew about a legal duty that existed and 2) intentionally (willfully) violated that legal duty.

The key part of a Cheek defense as opposed to other legal defenses is that is that the person charged with a crime is held to a subjective standard of what that person believed. Most other defenses in the law rely upon an objective standard which measures what a reasonable person in the defendant’s shoes would have thought or done. This means that the key part of a Cheek defense is convincing a jury that the federal criminal tax defendant did not have knowledge of the legal obligation or did not intentionally violate the legal obligation.

Legal commentators are often split on how you can prove up a Cheek defense when defending yourself in a federal criminal tax prosecution. For example, some practitioners take the position that a Cheek defense can be validly established simply by presenting expert testimony at trial.  At Evergreen Attorneys we believe in the power of storytelling and honesty.

That means that we 100% believe that when our clients want to raise a Cheek defense our clients must be prepared to take the stand in federal criminal court.

This requires preparing our clients from day one to testify. That conversation about your federal criminal tax trial starts during our initial consultation. We help our clients understand that they need to be mentally prepared for a tough cross-examination. Our federal criminal tax defendants need to be prepared to testify while also understanding that they are waiving their Fifth Amendment right to remain silent.

We think that is a small price to pay. Ask yourself: if you were on a jury and someone claimed they did not know about a legal obligation wouldn’t you want to hear directly from them?

One other issue that arises is whether the willful blindness by a defendant can be used to overcome a Cheek defense and satisfy the willful element of the offense. Federal courts across the country are split on this issue. Compare United States v. Mapelli, 971 F.2d 284, 286 (9th Cir. 1992) (disapproving of the approach); with United States v. Stadtmauer, 620 F.3d 238, 258 (3d Cir. 2010) (allowing the instruction).

You need an experienced federal criminal advocate like those at Evergreen Attorneys to help you figure out how this issue and others might impact your defense in a federal criminal tax prosecution.

Further Considerations

Defending against a federal criminal tax prosecution is an enormous task. You need to make sure that you higher the right lawyer the first time who is up to the challenge of holding the United States government’s feet to the fire. Mounting a viable Cheek defense is often vital to winning at trial in federal criminal tax cases.

If you’re in need of a federal attorney to resolve tax problems involving the federal government, contact us at Evergreen Attorneys for your free consultation. You can reach us today by phone to (303) 948-1489 or by email to [email protected].