How Do You Know If You’re Under Investigation For Tax Crime?

In the past, we have discussed what your rights are as a taxpayer and how that impacts potential allegations made against you, but how do you know when you need to exercise those rights? The number of cases that the IRS investigates each year can vary based on a variety of factors, including budget constraints and the resources available for enforcement. This means that they use specific tactics to find cases they want to prosecute. 


IRS Audits

One of the most common ways for the IRS to put out “feelers” for criminal activity is through the practice of auditing. Sometimes audits are random, and other times the IRS will use technology to select who or what they wish to audit. For example, they may use an algorithm to compare taxpayer behavior, or target specific industries or taxpayers that are considered “higher-risk.” Some of the taxpayers that constitute higher-risk industries include people who are self-employed, high-income earners, restaurants, retail businesses, and those who have a high volume of international transactions.


Tertiary Investigation

A commonly misunderstood tactic used by the IRS is when an IRS employee makes a seemingly casual inquiry directly to you, a friend, a business associate, or your accountant. Although they may be conducting an investigation at this point, it’s possible that they are still determining whether your case is worth pursuing. Regardless of whether you have intentionally or inadvertently participated in tax crimes, it’s important to treat this as a real interaction with law enforcement. The officials making the inquiries may not initially be made by law enforcement, but whatever you say may be admissible in court, which means that if you receive an inquiry of any kind, you may wish to immediately contact a lawyer. 


Formal Notice

Sometimes you may receive a formal notice from the IRS in the mail that proclaims you are under investigation. This could be a letter that simply states that you are under an IRS audit, or it could be a subpoena for records or a summons to appear for a formal interview. The information collected during your interview and the data from your financial records may determine whether there is enough evidence to support charges to be made against you. The process is very complicated and seeking of counsel is often-times the prudent thing to do.


What Happens If Charges Are Brought Against Me?

Depending on the charges, such as tax fraud and tax evasion, and the evidence collected, you may be arrested and face jail time. As with any criminal defense trial, it can be a lengthy process that not only upturns your life but also has the chance of affecting your personal freedom. Although it’s always advisable to incorporate legal counsel at the earliest opportunity, it’s still not too late for a good outcome.

If you are under investigation for tax crimes or believe that you may be soon, Weisberg Kainen Mark, P.L. is here to use its professional and effective legal counsel to help resolve your case. Contact our office at (305) 374-5544 to schedule a consultation today.

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Weisberg Kainen Mark, PL

As experienced trial lawyers with a passion for justice, our firm provides clients with compelling advocacy, attorney availability, and creative solutions to your tax or criminal law matters.

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