Paying Off a Tax Bill Doesn’t Eliminate Criminal Action

A taxpayer who was indicted for willful failure to pay over trust fund taxes (withholding of income taxes and the employee share of FICA taxes) then paid the outstanding taxes and asked the court to dismiss the felony charges against her. A district court in Kansas, in a case of first impression, refused to dismiss the charges.

The government argued that she cannot “cure” her violations or immunize herself from prosecution for those violations by paying the amounts due before trial because the alleged crimes were already completed. They were completed when she allegedly willfully failed to pay over the trust fund taxes when those payments were due. The court agreed with the government. A bank robber cannot avoid prosecution for the crime of bank robbery simply by returning the stolen money. So, too, a tax evader charged with a crime cannot avoid prosecution by paying the taxes owed.

Source: Rose Quinn, D KA, No. 2:09-cr-20075