Monday, March 5, 2012

Supreme Court Upholds Deportation for Filling False Tax Return

The United States Supreme Court has ruled that Immigrations and Customs Enforcement has the authority to label the crime of filing false tax returns, an "aggravated felony," subjecting lawful legal immigrants to automatic deportation.  The case involved Akio and Fukado Kawashima, a Japanese couple who came to the United States in 1984 with a goal of succeeding in business.  They opened up and operated a few popular sushi restaurants in California.  They never became U.S. citizens but were granted lawful permanent residence in the 1980's.  However, in 1991 they filed tax returns in which they underreported their income.  The federal government filed criminal charges against them and they plead guilty and paid $245,000 in penalties and interest.  They paid the entire amount in full and the husband ended up serving 4 months in a federal prison.  Ten years later, the Immigration and Naturalization Service decided to deport them.  In a 6 to 3 decision, the Supreme Court sided with Immigration and Naturalization and the Kawashima's have now been deported.  Tax lawyers point out that this ruling sends an ominous warning to legal immigrants.  If they are caught lying on their taxes, not only could they be forced to pay heavy monetary penalties, but they could also be deported.  This would apply to any false statement on a tax return made by a legal immigrant.  Immigration officials point to a 1994 provision created by Congress which defined "aggravated felony" to include "fraud" and "deceit" that cost the victims more than $200,000.  That threshold has since been lowered to $10,000.  It seems that deportation would apply to cases in which criminal charges were filed, not in cases involving only a civil penalty sought by the IRS.

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