Former Illinois lawmaker’s tax convictions upheld on appeal
United States v. Annazette Collins. United States Court of Appeals for the Seventh Circuit. Docket: No. 24-2161.
The Seventh Circuit upheld criminal tax convictions against a former Illinois state legislator after finding ample evidence of willful underreporting and failure to file returns, and no reversible trial errors.
Holding
The Seventh Circuit affirmed all convictions and the one-year prison sentence. The court found sufficient evidence of willfulness, no abuse of discretion in evidentiary rulings, and no authority for the district court to modify the sentence after the Rule 35 deadline.
Why It Matters
Criminal tax cases do not require direct proof of intent. Significant income discrepancies and filing history can establish willfulness.
Corrective actions taken after IRS detection usually do not negate criminal intent.
Defendants who decline to testify cannot appeal conditional impeachment rulings.
Sentencing adjustments for good-time credit eligibility are unavailable once the Rule 35 deadlines have expired.
Timeline
2013–2016: Defendant earns substantial income through consulting and insurance work.
2014–2015: Income is significantly underreported on filed returns.
2016: No personal or corporate tax returns filed.
2016–2017: IRS issues notice of unreported income and assesses tax liability.
2021: Grand jury indictment returned.
2025: Jury convicts on four counts. The district court imposes a one-year sentence.
December 18, 2025: Seventh Circuit affirms.
Key Facts
Defendant was a former Illinois state legislator.
She owned and controlled a consulting corporation.
She earned substantial income but reported only a fraction of it on her tax returns.
Corporate funds were used for personal expenses.
She failed to file both personal and corporate returns for 2016.
Corrective filings occurred only after the IRS detected them.
Statutory Framework
§7206(1), which criminalizes willfully filing false tax returns.
§7203, which criminalizes willful failure to file required tax returns.
Willfulness requires proof of a voluntary, intentional violation of a known legal duty.
Arguments
Taxpayer argued:
The government failed to prove willfulness.
Excluded evidence showed good-faith corrective actions.
Trial rulings violated constitutional rights.
The sentence should have been increased by one day to allow good-time credits.
Government argued:
Prior filing history and income discrepancies proved intent.
Post-detection corrective actions were irrelevant.
Evidentiary rulings were proper.
The court lacked jurisdiction to modify the sentence.
Court’s Reasoning
Prior compliance and legislative experience supported knowledge of filing duties.
Large income discrepancies supported the intent to evade taxes.
Reporting higher income to third parties undermined innocent explanations.
Failure to file after years of compliance supported willfulness.
Post-detection amendments did not reflect the original state of mind.
Excluding hearsay-based expert testimony was proper.
Defendant waived impeachment objections by not testifying.
Rule 35 barred sentence modification after fourteen days.
Result
All convictions and the sentence were affirmed.
The Takeaway
Criminal tax liability turns on intent at the time of filing or non-filing, not on later cleanup efforts, and appellate courts will defer heavily to jury verdicts where income patterns and conduct tell a clear story.