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Monthly Archives: November 2022

IRS CI Had a 90.6% Conviction Rate on Prosecuted Cases of Tax Evasion & Tax Fraud

IRS-CI released its 2022 Annual Report on November 3, 2022 which details the agency’s work in fiscal year (FY) 2022. 

The report noted that in FY 2022, CI’s special agents spent about 70% of their time investigating tax-related crimes like tax evasion and tax fraud and nearly 30% of their time was spent investigating money laundering and drug trafficking cases. 

During their investigations, special agents identified over $31 billion from tax and financial crimes, and seized assets valued at approximately $7 billion. 

CI also Had a 90.6% Conviction Rate on Prosecuted Cases


According to the report, in FY 2022 IRS-CI also expanded its partnerships with foreign counterparts to help combat tax and financial crimes across the globe. IRS-CI special agents provided training in countries like Argentina, Germany, Colombia, and Palau on topics ranging from cybercrime to human trafficking.

Finally, the report includes case examples for each U.S. field office, an overview of IRS-CI’s international footprint, details about the specialized services provided by IRS-CI and investigative statistics, broken down by discipline.

Have an IRS Tax Problem?

     Contact the Tax Lawyers at
Marini & Associates, P.A. 


for a FREE Tax HELP Contact us at:
www.TaxAid.com or www.OVDPLaw.com
or 
Toll Free at 888 8TAXAID (888-882-9243)

 


Read more at: Tax Times blog

What to Do When IRS Criminal Tax Division Contacts You?

If you are unfortunate enough to have IRS Criminal Investigation (CI) target you and execute a search warrant on your residence, cars, and small business KEEP YOUR MOUTH SHUT!!! 

Special Agent like to use the element of surprise, so more often than not, they will unexpectedly knock on your front door, usually very early in the morning, in either your home or place of business.They do this to catch you offguard and so you'll be unprepared and spill your guts. Imagine that you're getting ready to leave for work, take your kids to school, or just having your morning cup of coffee. Then a loud knock knock knock and two special agents are at your front door, flashing their gold badges and carrying guns, telling you they need to ask you some questions?

Politely and nonconfrontationally, ask for their business card and tell the Special Agents that you are not comfortable speaking with them at this time and you will have your criminal tax attorney contact them.

Do not say anything else and go back into your house or office.

Unless they have an arrest warrant, they cannot arrest you; and if they haven't shown you in a restaurant at the beginning of the contact, odds are they don't have one. Same for search warrant; unless they have a search warrant, you are not obligated to provide any documents or other items.

Do not provide any information, documents or other items, or ask any questions.

Anything you say can be used against you, even where you were told that you're being contacted as a witness and are not a target of an investigation.

While the agents can appear friendly and may try to make it seem like they are there to help you, keep in mind there investigating what they believe is a federal tax crime.

Here is what to expect: 

An IRS Special Agent with information sufficient to establish probable cause for a search warrant has filed an affidavit with a US Magistrate and obtains a search warrant.

The affidavit will be “sealed” to prevent access to the contents.  The agent (armed with guns, bullet proof vests and badges) will marshal forces with his fellow agents and possibly the local police department and to systematically execute the warrant with a team of investigators.  They will take all of your business and personal records.  If you maintain a “cash hoard” in a shoe box or safe deposit box, they may seize it as evidence of the crime of Income Tax Evasion (Title 26 USC 7201) or income Tax Fraud (Title 26 USC 7206(1)).

For those involved in illegal activities, there may be Money Laundering charges under Title 18 USC, 1956 and 1957.  This is the start of a long “Grand Jury” investigative process that will be unsettling and confusing to most individuals and inexperienced attorneys.  The services of an expert private investigator are required to assist your attorney in the defense of a criminal income tax investigation (Pg 2) conducted through this “Grand Jury” or “Administrative” Investigation.

There are two type of investigation conducted by IRS Criminal Investigation they are the “Grand Jury” investigation which with the assistance of an Assistant US Attorney (AUSA) allows the use of Grand Jury Subpoena, governed by Federal Rules of Criminal Procedure Rule 17, such as a Subpoena Duces Tecum (Bring with you records.) to gather evidence of the crime.  The second is the “Administrative Investigations” conducted through the use of IRS Summons which are similar to a Federal Grand Jury Subpoenas or Trial Subpoena and require the production of records, but are more cumbersome than the Grand Jury Subpoena.

Your reaction to the search warrant is critical at this time because, during the execution of the search warrant, you will be anxious to tell your side of the story.  You are and honest person but you should stop and tell the agent you wish to speak to an attorney.  In a “Grand Jury” investigation, you will not be read your rights as is required during an “Administrative” Investigation where the Internal Revenue Manual (IRM) requires that a non-custodial Miranda warning be read to the target.  Even though you are confused and do not have a criminal law attorney that practices in the Federal Courts ask to speak to one before further responding.  The agent is required by case law and procedure to stop asking you questions.  Do not be tempted to continue answering questions no matter what the agent says, statements you make are being witnessed and will be documented in writing and used against you later.  Do not be afraid to stop the questioning and “lawyering up,” this is your right under the Constitution of the United States.

During the search the agents will present a copy of the Search Warrant which sites the charges that are alleged and provides other information; including the name of the Special Agent that signed the Warrant.  This information should be provided to the defense attorney.  Generally, the agent will not talk to the attorney during the search and until a Form 2848 Power of Attorney is prepared for the individuals and all entities, signed by the client, and delivered to the IRS CI office.  The Special Agent will leave a computer generated inventory of the items seized from the premises.

HERE ARE EIGHT STEPS TO HELP YOU GET ORGANIZED

  1. Contact your business attorney and ask for a referral to a criminal attorney that has experience in the Federal Court System.  Former Assistant US Attorneys in private practice are generally excellent in these cases.  They know the system and are generally respected by the AUSA.
  2. The criminal defense attorney should prepare a letter of representation to the AUSA on the case to allow dialogue.
  3. The criminal defense attorney should hire an expert private investigator trained in investigation by the IRS and US Treasury Department (Pg1).  The investigator should receive an engagement letter that will allow the investigator to be covered by the attorney client privilege.  Generally a CPA is not necessary but a retired IRS Special Agent with a CPA or CFE would be beneficial to the case.
  4. The criminal defense attorney prepare Forms 2848 IRS Power of Attorney (available at www.IRS.gov/pub/irs-pdf/f2848.pdf) for each individual and entity involved (corporation, partnership, LLC, etc.)  The investigator should also be included on the IRS Power of Attorney.  The investigator will be dealing directly with the IRS Criminal Investigation Special Agent to secure access to the records and will determine the method of proof that the agents will pursue to prove their case.
  5. The expert private investigator will secure a copy of the search warrant inventory to determine the evidence that has been seized.
  6. The criminal attorney and the investigator will meet with the client and target of the investigation and discuss the matter, receive information necessary for the defense of the case, discuss the various methods of proof and what is involved and advise the client of what the future holds.
  7. The criminal defense attorney with the investigator will interview current employees to determine what has transpired with in the business and to determine if there are former disgruntled employees that may have gone to the IRS seeking a reward.  The new IRS tax Whistleblower statute (Title 26, USC 7623) gives anyone with information about large-scale tax underpayments, including accounting errors or tax fraud, a significant financial incentive to report it.  IRS will give up to 30% of the money collected base on the information.
  8. The defense begins.

Have an IRS Tax Problem?

     Contact the Tax Lawyers at
Marini & Associates, P.A. 


for a FREE Tax HELP Contact us at:
www.TaxAid.com or www.OVDPLaw.com
or 
Toll Free at 888 8TAXAID (888-882-9243)

 





Sources:


Read more at: Tax Times blog

IRS Makes It Easier to Obtain Collection Alternatives to Tax Levies

The IRS made changes in April 2022 that will positively impact taxpayers who are submitting an Offer in Compromise to resolve their outstanding tax liabilities.

  1. These include revisions to the Collection Financial Standards that the IRS uses to determine a taxpayer's reasonable collection potential and
  2. Changes to the information and documentation a taxpayer must provide when applying for an Offer in Compromise.

Collection Financial Standards

The Collection Financial Standards set by the IRS are used to determine an individual taxpayer's necessary monthly expenses, based on the taxpayer's age, geographic location, and family size. These necessary expenses include food, clothing, housing and utilities, out-of-pocket healthcare, transportation, and other miscellaneous items.

The IRS Has Increased These Standards as of 4/25/2022 in an Effort To Relieve Some Pressure From Taxpayers Who Are Struggling To Cope With The 40-Year High Inflation Rate.

This is great news for taxpayers with an outstanding tax liability with the IRS! These increases will help taxpayers who are seeking to enter into a Payment Arrangement or Offer in Compromise, with the IRS to resolve an outstanding tax liability.

The IRS also uses these Collection Financial Standards by comparing them to a taxpayer's household income and expenses, with the remaining amount considered as what the IRS will wants the taxpayer to remit each month.

Offer in Compromise

There are two big changes to the program:

  1. The first change is in relation to the IRS's traditional policy of keeping a taxpayer's tax refund through the year in which the taxpayer's Offer in Compromise is accepted. This means that if a taxpayer had an offer accepted in 2021 for a tax debt from 2018, the taxpayer would not see their 2021 refund. Now, however, the IRS will no longer adhere to this policy, and submitting an Offer in Compromise for a previous year will not jeopardize the taxpayer's current year's refund.
  2. The second change may require a taxpayer to submit much more information and documentation than what was previously necessary when submitting an Offer in Compromise. However, this only applies to taxpayers who have an ownership interest in a business.

Previously, if a taxpayer had an ownership interest in a business but the taxpayer's tax debt was strictly personal (e.g., 1040 Income), the taxpayer need only submit Form 433-A (OIC), Form 656, and all relevant documentation. Now, that same taxpayer with the same personal tax liability must submit Form 433-B in addition to the other forms. This would require the taxpayer to provide the profit and loss information of the business for 6 to 12 months prior to submitting the Offer in Compromise, as well as the business's bank statements, loan statements, notes and accounts receivable, and other pertinent documentation.

Have an IRS Tax Problem?

Contact the Tax Lawyers at
Marini& Associates, P.A. 

for a FREE Tax HELP Contact Us at:
www.TaxAid.com or www.OVDPLaw.com
orToll Free at 888-8TaxAid (888) 882-9243

 

 

 

 

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