What You Should Do When You Are Under Investigation for Tax Fraud
The Internal Revenue Service (IRS) and its Criminal Investigation Division (CID) take an aggressive approach to investigating cases of suspected tax fraud. According to the IRS’s figures, tax fraud costs the government nearly half a trillion dollars every year, and this includes everything from individuals deciding not to file their tax returns to major organizations fraudulently withholding millions of dollars that are legally owed to the federal government.
If you recently found out that you or your company is being investigated for tax fraud, you need to understand what you are up against. The CID is tasked with investigating suspected tax fraud, and its Special Agents are both experts on the federal tax code and skilled investigators who are very good at what they do. If the CID finds evidence to suggest that you have improperly withheld taxes and the government decides to press charges, you could face hundreds of thousands, or even millions, of dollars in liability plus the prospect of spending several years behind bars.
You’re Being Investigated for Tax Fraud. What Now?
Accept that You Have to Deal with the IRS?
Now that you know that you are being investigated for tax fraud, what should you do? First and foremost, you need to accept that you have to deal with the IRS. While it certainly would be nice if your situation resolved itself on its own, that isn’t going to happen unless the end result is a determination of criminal liability.
In order to avoid facing criminal charges, you will need to take proactive measures to defend yourself. Even if you owe back taxes, working with the IRS to resolve the issue will produce a far better outcome than trying to ignore the problem. Trust us, the IRS isn’t just going to go away.
But, Don’t Try to Deal with the IRS On Your Own.
That said, you do not want to try to deal with the IRS on your own. Like we mentioned earlier, the CID’s Special Agents are highly trained specialists, and the prosecutors who handle federal tax fraud cases know how to get convictions at trial. At the Oberheiden, P.C., our team of defense attorneys and former federal prosecutors has decades of experience representing clients in federal investigations. We can deal with the IRS on your behalf, and we can use our knowledge and experience to help minimize the consequences of your federal tax fraud investigation.
To Protect Yourself, You Need to Make Smart Decisions.
Know Your Rights, and Know How You Can Hurt Them.
As the target of a federal investigation, you have rights, and it is important that you use them to your advantage. For example, and perhaps most importantly, you have the right to legal representation. When Special Agents from the CID contact you or you receive requests for documentation, it is critical that you speak with an attorney prior to doing anything that could jeopardize your defense. While you may want to be as cooperative as possible, you also need to make sure that you do not unnecessarily (or unknowingly) give the IRS information that you are within your rights to withhold.
In addition to sharing too much information, the following are all common mistakes that can make it more difficult to defend yourself against allegations of tax fraud:
- Answering any questions from Special Agents with the CID without your attorney present
- Attempting to hide, destroy, or alter records that may be relevant to the CID’s investigation
- Lying to the IRS or giving evasive or misleading answers during CID interviews
Know that an Investigation is Not a Prosecution or Conviction.
However, it is also important to remember that, at this stage, you are only under investigation. This does not mean that you have committed a crime, and it does not even mean that you will necessarily face charges for criminal tax fraud. By making smart decisions and hiring experienced legal representation as soon as you find out that you are under investigation, you can give yourself the best chance possible to avoid facing an indictment and prosecution.
You Also Need an Experienced Legal Team on Your Side.
How to Choose a Law Firm for Your Federal Tax Fraud Investigation:
While there are many federal criminal defense law firms out there, not all of them provide the same quality of legal representation. When choosing a law firm for your federal tax fraud case, here are some key considerations to keep in mind:
- Defense Record The law firm that you choose should have a proven track record of helping clients escape federal investigations without facing civil or criminal charges. The firm’s attorneys should have extensive federal trial records, as well.
- Government Experience The firm’s defense team should include former federal prosecutors who have decades of experience in federal criminal cases. This inside knowledge can be critical to formulating an effective defense strategy that focuses on anticipating the government’s next move instead of reacting to whatever happens next.
- Federal Focus The firm’s practice should be focused on federal criminal defense. Defending a client in a federal investigation is very different from defending a client accused of committing a state crime, and you need to make sure that you have the right experience on your side.
- Team Approach Who will handle your case? Will you spend most of your time dealing with an inexperienced associate, or will you work closely with a team of senior attorneys throughout your federal tax fraud investigation?
- Free Consultations You should choose a law firm because you feel confident that it has the best attorneys, not because you have already invested in an initial consultation. Your initial consultation should be free, and the firm’s attorneys should be happy to answer any questions about their experience and what you can expect during your investigation.
Benefits of Choosing Oberheiden, P.C.:
At Oberheiden, P.C., our experienced defense attorneys, and former federal prosecutors regularly represent clients in complex federal investigations. We know how these investigations progress, and we know what the government’s attorneys look for when deciding whether to press charges. When you hire our legal team to represent you, we will quickly establish contact with the IRS, and we will work closely with you to develop a custom-tailored defense strategy that is focused on favorably resolving your investigation as quickly as possible.
The attorneys on our federal criminal defense team include:
- Dr. Nick Oberheiden, Principal Partner Dr. Nick Oberheiden is an accomplished federal defense attorney and our firm’s founder. He has extensive experience representing individuals and businesses in federal investigations involving the IRS and numerous other agencies.
- Lynette Byrd, Senior Counsel As a former Assistant United States Attorney, Lynette Byrd has years of experience working in law. She focuses her practice on criminal and civil litigation, Medicare and insurance audits, and general advice and counseling within the realm of the healthcare law. Clients of Attorney Byrd have great respect for her ability to merge her profound law understanding with her superb litigation skills.
IMPORTANT: Your Discussions with Your Accountant Are Not Always Privileged.
When facing a federal investigation, you need to be very careful not to discuss the matter with anyone other than a member of your defense team. In federal tax fraud cases, this includes your accountant. While federal law provides a limited privilege for certain accountant-client communications, this privilege does not apply in criminal investigations. It also does not apply to accountants who do not hold CPA credentials.
For more on what the accountant-client privilege does not protect, we encourage you to read: For Those with Tax Issues: “Watch Your Mouth” with Accountants.
Take Action to Defend Yourself Against the IRS Schedule a Free, Confidential Consultation at Oberheiden, P.C. Today
A federal tax fraud investigation is stressful and invasive, but it doesn’t have to ruin your life. As we mentioned above, the key to protecting yourself as much as possible is to hire an experienced defense team as soon as you find out that you are under investigation. At Oberheiden, P.C., we represent clients in federal tax fraud investigations nationwide, and we can take action quickly to help you protect your rights. To get started with a free, confidential consultation, submit our online case evaluation form or call 866-603-4540 today.
Dr. Nick Oberheiden is a national litigation and trial criminal defense attorney who practices exclusively in the area of federal law.