I am in Texas.
I recently quit my job after two years. The entire time I worked there, I was aware of some serious tax law violations that probably constitute fraud. Several hundred thousand dollars were not reported as income. Also, the company owner deducts all his housekeeping staff and nannies as business expenses. Am I correct that housekeepers and nannies (household employees in IRS terms) are not tax deductible?
I have been bothered by the situation from the time I learned about it. I just needed the job very badly and chose to ignore my concerns for a long time. Before I left, I made copies of financial statements, G/L transactions showing when these payouts occured and how much, emails to and from my boss, the company owner and our CPA discussing the unreported income.
The company suspects i have some information on them according to an employee who is still a friend of mine. The owner has said if I 'stole' company records he is going to sue and/or prosecute me. I have refused to discuss with anyone or admit any kind of liability or my intentions.
I also had a long discussion with an IRS investigator a few days ago via phone. I refused to give my name or the name of the company at that time until I could figure out all the ramifications of my actions.
Here are my questions-
Did I technically 'steal' by making copies of the documents? If so, wouldn't the burden of proof fall on the company?
Secondly, if I took the copies solely for the purpose of proving tax fraud/tax evasion, would that shield me from legal action for taking them?