The most terrifying words in the English language are: I’m from the government and I’m here to help.”  Ronald Reagan

One of the roles of a tax attorney is to represent clients in criminal tax cases.  Most people are aware that not filing a tax return and not paying taxes can result in serious penalties and interest and the IRS can, and often will, seize and sell assets to pay those taxes.  But few people are aware that not filing tax returns and not paying taxes can be crimes that, under certain circumstances, can result in the imposition of a sentence of imprisonment.  So today I want to face the New Year with a renewed emphasis on taking action to prevent or reduce these problems.


  1. Take Action Early


If you have failed to file a required tax return, failed to pay a required tax, or falsely reported (overstated, understated or omitted) items on a return that has been filed, retain an attorney and take action now before you are contacted by the Internal Revenue Service.  There is a lot you can do to help yourself if you act early.


  1. Effective Counsel


If you are already being audited and there is any possibility of a criminal issue, it is essential you immediately retain seasoned and effective counsel. Criminal tax law is a very narrow specialty with a very specific and complex focus and the outcome of a potential criminal audit will rest on this decision. Retain an attorney with extensive and proven experience in criminal tax matters. In a recent criminal tax case, the taxpayer argued that his conviction should be set aside claiming he did not receive competent advice or representation from his counsel.  Don’t be another victim.


  1. Right to Counsel


If you are contacted by an IRS agent, you should know – and be advised – of your rights – including your right against self incrimination and right to counsel. One of the most effective tools used by IRS in developing a criminal tax case is to get us to start talking. IRS agents are trained to encourage people to talk.  They write down everything they think they heard you say and can use it against us in court.  The Catholic Church struggles to get us to confess our sins, and few do, yet these same penitents often will not shut up when meeting with an IRS agent.


  1. Don’t Obstruct the Investigation


Many federal tax crimes are misdemeanors which can result in fines and even some prison time. However, efforts to hide these crimes can create a felony (i.e. obstruction of justice) resulting in more serious fines and increased prison time.


You may not even realize that what you are doing – is actually hurting your case and even worse, making a case for IRS! Events such as transferring property, talking to potential witnesses, or destroying documents can be considered as obstruction of justice.


  1. Parallel Investigations


Normally, the IRS is not allowed to civilly and criminally investigate taxpayers at the same time.  But many attorneys believe that the IRS may use a civil audit to obtain information for later use in a criminal case.  An example of this would be the IRS seeking civil evidence that – due to attorney/client privilege – your criminal attorney would never turn over to an IRS agent in a criminal investigation – but inadvertently do so in a civil case.


In conclusion, please heed my advice.  If you have failed to file or failed to pay, get an attorney and take action now to fix it. If the IRS has already contacted you and there is any risk of criminal liability, shut up and get a good criminal tax attorney right away.  Don’t be a passive victim!