There are many reasons why you might end up facing an Internal Revenue Service (IRS) tax investigation. Many taxpayers don’t even know they’re under investigation regarding alleged tax evasion or tax fraud until the IRS comes looking for them. There are many different kinds of tax fraud that all attract different penalties, and without proper counsel, it is easy for issues to spiral out of control. If an IRS agent comes across incriminating information during the civil audit, it can lead to an indictment or jail time in certain cases. When you understand how the IRS initiates its tax investigations, you can take preemptive measures by hiring an IRS tax problems resolution attorney to represent you. Understanding how IRS tax investigations are initiated is key.
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Who Informs the IRS of Possible Fraud?
The IRS has multiple sources of information. They include-
- Information collected by revenue agents and revenue officers
- Information provided by other law enforcement agencies
- Information collected from your digital footprint
- Indiscrepancies found during computer data analysis
- Information provided by whistleblowers
What Happens with this Information?
This information is analyzed to ascertain whether or not tax fraud or a different financial crime is being committed. This process is called a primary investigation. After the primary investigation is over, a supervisor looks at the collected facts to determine if the findings are to be further investigated or not. If the supervisor gives his go-ahead, the case is sent to management for approval, after which a special agent begins a criminal investigation. At this point, the IRS has established they have enough evidence to start a criminal investigation.
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Prevention is Better than Cure
If the IRS decides to start a criminal investigation, it means that they have enough evidence to prosecute you. With a conviction rate of 91.2%, it is safe to say that a guilty verdict is all but assured. Paying taxes on time and consulting an attorney helps ensure that you stay protected and get ahead of the IRS tax investigation.
Final Word
Every year, the IRS publicizes well-known criminal tax cases to discourage other people from following suit. If you come under an IRS tax investigation, make sure that you hire a tax resolution attorney to get a favorable outcome or mitigate the consequences. If you’re looking for IRS tax help in Dallas-Fort Worth, our team of skilled IRS resolution attorneys at the Law Offices of Nick Nemeth can help you with IRS tax investigations and other related tax issues. For a free consultation call (972) 426-2553 or fill out our contact form and a professional will get back to you as soon as possible. We look forward to assisting you.
