If you’re facing tax evasion charges in New Jersey, it is imperative that you understand the potential penalties associated with a conviction. Continue reading and consult with a Mercer County white collar crime lawyer for more information and legal assistance today.

What is Tax Evasion?

Tax evasion is generally defined as the willful attempt to evade or defeat a tax imposed by law. In New Jersey, relevant statutes include N.J.S.A. 54:52-9 and N.J.S.A. 2C:21-4.

N.J.S.A. 54:52-9 refers to failure to pay. Under this statute, a person is guilty “if he fails to pay or turn over when due any tax, fee, penalty or interest or any part thereof required to be paid pursuant to the provisions of the State Tax Uniform Procedure Law, R.S. 54:48-1 et seq., as amended and supplemented, or any State tax law, with the intent to evade, avoid or otherwise not make timely payment or deposit of any tax, fee, penalty or interest or any part thereof.”

N.J.S.A. 2C:21-4 defines falsifying or tampering with records as when a person “falsifies, destroys, removes, conceals any writing or record, or utters any writing or record knowing that it contains a false statement or information, with purpose to deceive or injure anyone or to conceal any wrongdoing.”

Essentially, tax evasion occurs when someone intentionally hides income, falsifies tax documents, or takes other purposeful steps to avoid paying the taxes that they owe. The most important element is the individual’s intent. In order for it to be considered evasion, the prosecutor must prove that the conduct was knowing and purposeful.

Is Tax Evasion a Misdemeanor or Felony?

New Jersey law does not use the terms “misdemeanor” and “felony,” instead classifying crimes by degrees. Comparable classifications are “disorderly persons offense” and “indictable crimes.”

With that being said, tax evasion is a serious offense in New Jersey and may be charged as either a fourth, third, or second degree indictable crime. Essentially, yes, tax evasion is treated with the same severity as other states would treat felony offenses.

What Are the Penalties for Tax Evasion in NJ?

The penalties associated with a tax evasion conviction in New Jersey vary depending on the degree of the crime. The degree is based on the amount of tax loss, the nature of the conduct, and the offender’s prior criminal history, among other things. Consider the following general sentencing guidelines:

  • Fourth-degree crime: Up to 18 months in state prison and fines of up to $10,000
  • Third-degree crime: 3 to 5 years in state prison and fines of up to $15,000
  • Second-degree crime: 5 to 10 years in state prison and fines of up to $150,000

In addition to these penalties, certain convictions may result in additional consequences such as restitution, civil fraud penalties, interest on unpaid taxes, tax liens, wage garnishment, and more. Reach out to a skilled attorney for more information and legal advice today.