Criminal Tax cases typically begin by a referral made from a civil unit within the IRS to the Criminal Investigation Division of the Internal Revenue Service. Civil IRS agents refer potentially fraudulent cases to the Special Agents within the IRS. Civil IRS agents do not have a uniform standard of what is considered fraud, so the earlier counsel is involved in the case then necessary precautions may be taken to protect your interests.
If facing an audit, and the previously filed tax returns may contain either substantial understatements of income or overstatements of deductions, then it is highly recommended that you seek legal counsel. This is commonly known as an “egg shell audit” situation. The “accountant-client privilege” does not extend to criminal investigations, so your accountant may be compelled to talk to the IRS about their conversations with you and the work they have performed for you. Moreover, the accountant subpoenaed to testify at a grand jury indictment or at trial. Communications between an attorney and a client are protected by “attorney-client privilege” during any proceeding.
Common signs that a criminal investigation has begun are: 1. Revenue agents who have been involved in your audit suddenly are removed; 2. Aggressive revenue officers stop contacting you; 3. Or an IRS Special Agent approaches you or someone you know. If you are approached by an IRS Special Agent, let the Agent know that you are obtaining legal counsel. Special Agents may have knowledge about your situation that you may not be aware of and things that are said or done during this time may have damaging legal repercussions to your case.
If you believe you are under an IRS Criminal Investigation or are currently under investigation, contact Boyle Frost and get the help you need today.