IRS Tax Investigations Attorney

Unfortunately, you may not know that you are being investigated by the IRS. Unlike other proceedings such as audits, tax investigations do not require disclosure to the subject. Therefore, you may not know that you are being investigated until the final stages of the process.

The good news is that there are some signs that you are being investigated. If any of these happen, you should think carefully about your next steps and consider hiring an attorney:

• IRS Stops Contact: An IRS agent has been pursuing you about your tax debt but suddenly stops. If you can no longer get in touch with the agent, your case may have been referred to the Criminal Investigation Division. The same applies to an audit. If it suddenly seems to stop without warning or final resolution, you may be under investigation. This sign is not as certain as some of the others. However, it may be wise to consult an attorney at this point.
• IRS Agent Is Very Interested: While audits often happen due to errors or misunderstandings, they can sometimes be the result of criminal activity. If the IRS agent is very interested in certain transactions, requested a lot of documentation, or focused on the intent of transactions rather than the form, that could be a sign of an investigation.
• CID Agent Contacts You: If a CID agent contacts you in an official capacity, it is about an investigation. The investigation may not be into you, but it is definitely a good idea to get legal help before speaking with the agent.
• Bank Records Requested: Your bank may inform you that the IRS has summoned your bank records or the U.S. Attorney’s Office has subpoenaed them. If this happens, you are almost certainly under investigation and should contact a lawyer immediately.
• Accountant Contacted: If your accountant has been contacted by investigators or your tax records have been subpoenaed from them, you will need an attorney. Keep in mind that your conversations with your accountant are not legally privileged. The government can compel your accountant to be a witness against you in a criminal case.

Yes, the IRS can summon your bank account records or subpoena them with the help of the U.S. Attorney’s Office. During IRS tax investigations, it is reasonable to assume that the IRS either has reviewed your bank records or will in the future. This can also happen during an audit if the discrepancies are sufficiently serious. However, it is worth noting that the IRS typically does not dig deep into your bank records unless it believes doing so is necessary (such as you may have committed a crime or have been selected for an audit).

Fraud is a difficult charge to prove in many cases because it requires fraudulent intent. Simply having a mismatch between your finances and your tax filings/payments is not enough to prove fraud. The IRS typically relies on a combination of circumstantial evidence and “reasonable inference.” Interviews with your associates, particularly your accountant, may play a big role in establishing fraud. The CID will try to show that there is an active and intentional effort to commit tax fraud.

Simply checking your tax returns is called an audit. However, if the IRS is investigating potential criminal charges, the process is aptly called an IRS Criminal Investigation. These are conducted by the IRS’s Criminal Investigation Division or CID.