Technically, yes, you may have committed tax fraud or evasion when you portrayed your income inaccurately in order to receive larger subsidies for health insurance.
If your application triggered an audit, it’s likely that you have a history of providing the IRS with filings that contain “red flags,” but it’s also possible that your number simply came up and the two aren’t related. Still, caution is called for.
The way that the subsidies, technically structured as tax credits, are ultimately reconciled is through your annual tax filing.
Assuming you aren’t planning to defraud the Internal Revenue Service in April, you’ll report your earnings and the subsidies you received through the exchange.
If your earnings are significantly higher than indicated, you may be on the hook to pay back some or all of the tax credit you claimed.
If you have a history of improperly filed tax returns and have claimed a big tax credit for yourself, contact an attorney right away.
The IRS investigates relatively few cases of tax fraud and prosecutes even fewer, but that doesn’t mean it’s nothing to worry about.
As the value of widely available tax credits increases, the IRS will have to respond with greater enforcement.
Call our team of NYC criminal defense attorneys today at (212) 577-6677 for a consultation right away.