Will the IRS Send You to Jail? Civil vs. Criminal Tax Issues

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Are you worried that claiming a tax deduction might land you in an orange jumpsuit? Fear of the IRS stops too many business owners from taking legitimate tax-saving opportunities. 

In this episode, we’re breaking down the difference between civil and criminal tax cases—and exactly what really puts people behind bars. Special guest Robert Nordlander, CPA and former IRS Criminal Investigator, shares insider stories and tips you won’t want to miss.

Chapters:

(00:57) Civil vs. Criminal Tax Issues: 90% of IRS activity is civil and focused on collecting what’s owed. Criminal charges only apply when there’s willful fraud.

(03:25) What Does Criminal Intent Look Like? Mistakes or gray areas won’t land you in jail. It’s repeated deception, false documents, and ignoring professional advice that cross the line.

(06:48) Does an IRS Audit Mean Jail Time? No. Audits are civil. Agents are trained to spot fraud indicators, but very few cases ever get referred to the criminal division.

(13:39) Aggressive Tax Planning vs. Illegal Tax Evasion: Learn where the line is between pushing the rules and breaking the law… and why you should ignore TikTok tax advice.

(19:04) What Actually Gets Business Owners in Jail: Payroll taxes are the #1 reason small business owners get in trouble—especially when they use withheld taxes for personal expenses.

(27:52) What to Do If You Get an IRS Letter or Criminal Inquiry: Step one—open your mail! Step two—hire a pro. If IRS Criminal Investigation shows up? Lawyer up and stay quiet.

Guest: Robert Nordlander, CPA – https://www.nordlandercpa.com

Find Robert’s Books: 

• Criminal Tax Secrets: What Every Defense Attorney Should Know
• Unpaid Payroll Taxes: A Time Bomb You Can Defuse
• Erase the Penalty: A Tax Professional's Guide to Abatement

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Podcast Host: Mike Jesowshek, CPA - Founder and Host of Small Business Tax Savings Podcast

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🎙 ABOUT THE PODCAST

The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies designed to help entrepreneurs and small business owners legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this podcast breaks down complex tax topics into clear, actionable, no fluff insights, so you can maximize your savings and keep more of your hard-earned money.