When a Taxpayer violates the Internal Revenue Code, it is assumed they committed a tax crime. Most IRS violations are not criminal and escape criminal investigation. The Internal Revenue Service (IRS) investigates and prosecutes thousands of taxpayers suspected of committing tax crimes.
IRS CRIMINAL INVESTIGATION
If the IRS believes you committed a tax crime, a criminal investigation could be filed against you. Typically, IRS Special Agents are tasked to investigate your finances, background, and tax history to assess damage costs. In recent years, making foreign accounts compliance a key enforcement priority, taxpayers failing to disclose offshore accounts, income, assets, and investments remain at a high risk.
CRIMINAL INVESTIGATION TACTICS
The US Government, Department of Justice, IRS, have decided Federal Tax Crimes involving tax fraud and tax evasion and that involves Offshore Accounts and Foreign Incomes, a key priority. Typical criminal tax investigations by IRS include: Tax Fraud, Money Laundering, Tax Evasion, Structuring & Smurfing.
IRS CRIMINAL INVESTIGATIONS WITH VOLUNTARY DISCLOSURE
Upon realizing that you have undisclosed or unreported foreign accounts (wilfully or non-wilfully), compliancy options are available. Mostly, it is impossible to know if you are under investigation, but there are ways to assess your risk for an IRS criminal investigation or if already under investigation. Some common tactics the IRS uses when pursuing criminal investigation, are:
CONTACTED YOUR BANK MANAGER
When the IRS believes the taxpayer is using their bank account to transfer illicit funds, they may contact your bank’s Branch Manager for informal information relating to your account, without alerting. IRS agents visits your bank manager, for research on funds transfers, moving money offshore, and other matters related to the bank account.
SHOWING UP AT YOUR HOME UNANNOUNCED
Sometimes, IRS Special Agents visit your home to catch you off-guard. You need not speak with the Agents except for being present with counsel. If Special Agents desire to discuss with you, you should get ready their information after contacting your attorney first.
SHOWING UP AT YOUR PLACE OF EMPLOYMENT UNANNOUNCED
IRS Special Agents may also show up at your place of employment, without notice. You need not speak with the Special Agents unless your counsel is present; so if the Special Agents approach you contact your attorney immediately.
SUDDEN STOPPING OF All COMMUNICATION DURING AUDIT
This is actually common when the Taxpayer is under review of civil audit, and the Auditor or Examiner believes that a criminal tax violation has occurred. The Examiner cannot discuss criminal matters with the Taxpayer, stops the audit and puts it on hold while contacting their Supervisor about the data available and further actions to be initiated.
INTERVIEWING YOUR CPA
If your CPA is under audit or is being professionally examined by the Office of Professional Responsibility or the IRS feels the CPA has information it requires through interview/deposition, they may contact your CPA directly. There is no attorney-client privilege criminal or quasi criminal information.
Seek Experienced Counsel
If out of compliance, discuss matters with experienced Attorneys prior to any affirmative statements to IRS. Under the IRS Voluntary Disclosure law, an IRS offshore disclosure cases, tax attorneys have Board-Certification, more than 20 years worth of attorney experience, and LL.M qualifications with dual-licenses in law and tax.