Booker Variances are More Common in Tax Crimes. Why? And Do They Disproportionately Benefit the Rich?

Readers of this blog should be familiar with the name Ty Warner. He is the billionaire who cheated on his U.S. taxes big time (the financially big can cheat big) and, in addition, willfully failed to file the FBARs. He pled guilty to a reduced set of charges. He was sentenced to no incarceration. The Government is appealing the lenient sentence as an abuse of sentencing discretion by the sentencing judge. See When is Booker Variance Too Much? Per DOJ, Certainly in the Ty Warner Case (Federal Tax Crimes Blog 5/12/14), here.

Forbes tax columnist, Janet Novack, has discussed the Warner sentencing in the context of the larger sentencing subset of tax crimes generally. Janet Novack, Federal Judges Are Cutting Rich Tax Cheats Big Sentencing Breaks (Forbes 5/14/14), here. As she presents the larger discussion, tax crimes generally get more lenient sentences -- in the jargon of the defense industry, a downward variance from the Sentencing Guidelines. That phenomenon has occurred since Booker, although one could see its tendencies in the pre-Booker regime with departures in tax cases. When there is a persistent variance as presented by Ms. Novack, one has to question whether the Guidelines are serving their purpose in the case of tax offenses. And, even within the set of Guidelines-lenient sentence in tax cases, there may even be more leniency for the rich tax cheat than for the poor one.

View Jack Townsend's opinion in its entirety on the Federal Tax Crimes blog site.

For additional insight, explore Tax Crimes, authored by Jack Townsend and available at the LexisNexis® Store

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