Tax Evasion Is Not One of the Better Crimes to Think About Committing

The Justice Department will keep working to better deter tax crimes perpetrated by small businesses, according to Kathryn Keneally, assistant attorney general for the DOJ Tax Division.

The small business owner who complies with all of his tax obligations can have a difficult time competing with business owners who do not, Keneally said September 27 during a panel on criminal tax sentencing at the Villanova Law Review Norman J. Shachoy Symposium. To level the playing field between the honest business owner and the individual who is cheating, it is important to prosecute those crimes, she said, adding that it is a priority for the Tax Division. "I felt strongly about this when I was in private practice, and I feel strongly about this now," Keneally said.

Keneally said the division is also focusing on so-called gatekeepers, the fraudulent return preparers and the promoters of abusive schemes who lead others into criminal activity. It is vitally important that the DOJ, through both its criminal enforcement and civil injunction operations, shut down those activities and communicate a consistent message that they will not be tolerated, she said. Keneally said, "We do have tools, and we are actively using those tools to go after fraudulent return preparers."

Addressing the department's budget constraints under sequestration, Keneally said the Tax Division is committed to using the money it has to find and prosecute the cases that would have a strong deterrent effect. Noting that the division's conviction rate is over 95 percent, she said, "Tax evasion is not one of the better crimes to think about committing."