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What will you say if the IRS doesn’t go after Cryer in a civil proceeding?

There is to have a civil proceeding to establish a liability for taxes and late filing and late payment penalties. Cryer would have to pay his taxes due then sue for a refund if he wants to argue his tax liability.

Among the penalties related to filing returns and paying tax that may be imposed are: (1) the penalty for late filing imposed by Code Section 6651. See Section 606.3(b). (2) the penalties for failure to pay tax imposed by Code Section 6651. See Section 606.3(c). (3) the accuracy-related penalties imposed by Code Section 6662. See Section 606.4. (4) the civil fraud penalty imposed by Code Section 6663. See Section 606.5. (5) the penalty for filing a frivolous income tax return imposed by Code Section 6702. See Section 606.6. (6) the penalty for paying with a dishonored check imposed by Code Section 6657. See Section 606.10. (7) the penalties imposed on tax return preparers under Code Section 6694. See Section 620.7. (8) the penalty imposed for failure to sign returns or furnish identification numbers imposed on preparers by Code Section 6695. See Section 620.3. (9) the penalty for failure to file a partnership return or the failure to include information required to be shown on a partnership return imposed by Code Section 6698. See Section 402.8. (10) the penalty for aiding and abetting an understatement imposed by Code Section 6701. See Section 620.7.

Then if the IRS want to go for the works could attempt civil fraud

An important issue for the civil fraud penalty is the effect of a prior conviction or acquittal of a tax crime. Generally the IRS will pursue a taxpayer on criminal charges first and thereafter pursue civil penalties because otherwise the taxpayer could assert during the civil investigation his Fifth Amendment privilege against incrimination. In a situation involving criminal proceedings followed by civil proceedings, the legal doctrine of collateral estoppel may apply. Collateral estoppel provides that an issue necessarily decided in a previous proceeding (the first proceeding) will determine the issue in a subsequent proceeding (the second proceeding) but only as to the matters in the second proceeding that were actually presented and determined in the first proceeding. There exists for tax fraud, however, a significant difference between the first criminal fraud proceeding and the second civil fraud penalty proceeding, and that difference is the burden of proof to establish fraud. In a criminal proceeding, the government must establish fraud beyond a reasonable doubt, which is a difficult burden of proof to meet. In contrast, in a civil fraud penalty case, fraud need be proved by only clear and convincing evidence, which is less than the beyond a reasonable doubt standard, but clear and convincing evidence is more than the mere preponderance of the evidence standard. Because of the differences in the burden of proof, the following operating rules apply: (1) Conviction for tax evasion collaterally estops the taxpayer from contesting the existence of fraud for purposes of the civil fraud penalty because a finding of criminal fraud beyond a reasonable doubt necessarily establishes proof of civil fraud by clear and convincing evidence. [30] (2) Acquittal of tax evasion does not collaterally estop the government from proving civil fraud by clear and convincing evidence because the acquittal established that proof of fraud did not exist beyond reasonable doubt, but that does not mean that proof of fraud by clear and convincing evidence does not exist. Helvering v. Mitchell, 303 U.S. 391 (1938). (3) Acquittal or conviction of filing a false return or statement or of aiding or assisting in the preparation of a false return is not dispositive for purposes of the civil fraud penalty because intent to evade tax, which is an element of the fraud penalty, is not an element of either crime under Code Section 7206(1) or 7206(2). [31] Above is extracted from a tax reference book