Though it is commendable that you're wanting to correct things, employing an accountant to complete these overdue returns is actually a big mistake. The reason why is basically because tax evasion is really a criminal offence or felony. You mi...
You have been feeling anxious (maybe even guilty) because you have did not report your beneath the table company income. Maybe you've never filed a tax get back, even though you know you owe money. Finally, you contact an accountant to resolve the specific situation.
While it is commendable that you are trying to correct matters, employing an accountant to accomplish these overdue returns is actually a big mistake. Exactly why is because tax evasion is a criminal offence or prison. You could also be at the mercy of civil action.
Would an accountant be hired by you to protect you in a criminal proceeding? Not likely. You'd be wise to retain an experienced attorney.
To begin with, attorneys have something called solicitor-client privilege (also known as attorney-client privilege or legal advice privilege). This ostensibly defense attorney
means that things you tell your attorney when seeking legal advice are secret and can not be properly used against you. Also written records could be covered by this advantage.
On the other hand, your accountant can be required to testify against you and all documents in his possession can be demanded by the authorities.
Next, your attorney can prepare a legally binding contract that can protect you. In substitution for your coming clean, the tax authorities may possibly agree to not charge you criminally and, in some instances, also reduce fines or tax liability.
If your accountant tried to do the same, they can demand all information regarding you. Your accountant would not be secured by privilege.
On your behalf if, say, your accountant filed your tax get back from ten years ago, the tax authorities could however charge you with tax evasion, despite the fact that you're obviously attempting to rectify matters (although a little late).
It's even possible that your accountant might get in to trouble for failing woefully to report your delinquency. On one other hand, your attorney can not be required to testify against you, being protected by privilege. Your attorney may also have his own in-house accountant to be able to protect you.
Your attorney (focusing on criminal and tax law) will likely negotiate an agreement with the tax authorities before completing any tax returns.
Thus, if there is a great chance you may be charged criminally for your failure to file tax returns or precisely report income or expenditures, do not see your accountant. Alternatively, consult with a attorney focusing on such things when you file or change any returns.Matthew R. Hoff Attorney at Law
2901 Main St
Vancouver WA 98663