The Covid-19 pandemic has disrupted almost every aspect of our society, and the IRS has been no exception. For a while, IRS field offices were closed in most areas as agents, and other employees scrambled to transition to work-from-home as much as possible. Many planned audits were put on hold because of the lack of resources necessary during the early days of this health emergency.
As IRS field offices continue to reopen in areas around the country starting on July 15, 2020 and the agency overall begins to ramp up its normal operations, we are seeing every indication that audits will resume, particularly audits of high-net-worth taxpayers. If you believe your returns were inaccurate or incomplete or that your actions exposed you to other potential tax violations or tax crimes, now is the time to contact our experienced Tax Lawyers and CPAs at the Tax Law Offices of David W. Klasing. They can help you get back into compliance before an audit or criminal tax investigation is initiated. If you have already received notice of an audit or criminal tax investigation, we can help you reconstruct/present the necessary records and fight to ensure that your constitutional rights are respected, and the financial damage and criminal tax exposure is mitigated as much as possible.
Note: As long as a taxpayer that has willfully committed tax crimes (potentially including non-filed returns coupled with affirmative evasion of payment) self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosure before the IRS has started an audit or criminal tax investigation/prosecution, the taxpayer can ordinarily be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously often receive a break on the civil penalties that would otherwise apply.
It is imperative that you hire an experienced and reputable criminal tax defense attorney to take you through the voluntary disclosure process. Only an Attorney has the Attorney-Client Privilege and Work Product Privileges that will prevent the very professional that you hire from being potentially being forced to become a witness against you, especially where they prepared the returns that need to be amended, in a subsequent criminal tax audit, investigation or prosecution.
Moreover, only an Attorney can enter you into a voluntary disclosure without engaging in the unauthorized practice of law (a crime in itself). Only an Attorney trained in Criminal Tax Defense fully understands the risks and rewards involved in voluntary disclosures and how to protect you if you do not qualify for voluntary disclosure.
As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, Kovel CPAs and EAs, our firm provides a one-stop-shop to efficiently achieve the optimal and predictable results that simultaneously protect your liberty and your net worth. See our Testimonials to see what our clients have to say about us!
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Pre-Pandemic, The IRS Announced a Program to Increase In-Person Visits to High-Income Non-Filers
At an April 2019 hearing with IRS Commissioner Charles Rettig, several high-ranking Senators and Congresspeople made the case that the IRS was unfairly focusing its enforcement efforts on low-income individuals and letting high-income folks who commit tax crimes involving far more money off the hook. Partially in response to this hearing and the follow-up around this issue, in February 2020, the IRS issued a press release detailing a new program to be conducted through in-person visits by agents to taxpayers’ homes. This program will target those who make more than $100,000 per year who did not file proper tax returns in previous years. The stated goal of the visits was to inform these taxpayers of their outstanding obligations and bring them into compliance. However, it was unclear whether this process would be equal in scale and scope to an official audit.
The Pandemic Puts A Wrench in the Agency’s Plans
Of course, shortly after the press release was put out in February 2020, the United States and the entire world found itself in the middle of an unprecedented global health crisis that required many aspects of our society to come to a complete halt. At the beginning of the pandemic, the IRS was forced to shutter most of its in-person offices and operations right at the height of tax season. While the tax deadline was extended, the transition to working from home was far from smooth for the IRS, and the agency was generally not beginning any new audits in the first few months of the pandemic. Many on-going audits and appeals were forced to be delayed or transformed into correspondence audits. The high-income audit program was primarily put on hold, though the agency recommitted to beginning these efforts as soon as feasible in the current situation.
Audits on High-Income Earners Set to Begin This Summer
In June 2020, the agency made a major announcement regarding the renewal of its efforts to target high-income tax evaders. Douglas O’Donnell, Commissioner of the IRS Large Business and International Division (LB&I) announced that on July 15, 2020, the IRS is set to begin a new program targeting high net worth individuals with audits. This program is likely an adjustment of the original plan to conduct in-person visits, now that this remains an impossibility in large swaths of the country.
This new program will mostly be conducted by the “Wealth Squad,” which is the nickname for what is technically known as the Global High-Wealth Industry Group, a group of experts on how to track down and bust high net worth individuals who use elaborate schemes to avoid paying taxes. Its philosophy is “to take a holistic approach in addressing high-wealth taxpayers in order to view the complete financial picture of the taxpayer and the enterprises that they control.”
If you have already received notice from the Wealth Squad or a related entity that you are the subject of an audit, reach out to a skilled Tax Attorney like those at the Tax Law Offices of David W. Klasing as soon as possible. We can represent your rights and interests during the audit and, if necessary, work out a deal for you to pay back what you owe without further penalties being assessed. If you have yet to receive notice of an audit or criminal tax investigation, but you are a high-net-worth individual who has failed to file returns or has filed incomplete or misleading returns in past years, you should also reach out to our skilled Tax Attorneys and CPAs right away. We can work to get you back into compliance before an audit begins.
If You Are a High Net Worth Individual Concerned About Tax Liability, Call Our Skilled Tax Lawyers and CPAs Today
It is clear that, despite the delay caused by the Covid-19 pandemic, the IRS still considers criminal tax investigations and audits of high net worth owners, especially those who have failed to file returns in recent years, to be a top priority. Whether you have been contacted by the Wealth Squad or another department within the IRS about potential issues or you are simply concerned about future exposure, your first step should be to speak with an experienced Tax Lawyer and CPA like those at the Tax Law Offices of David W. Klasing. We will work to assess the situation and bring you back into compliance with as little trouble as possible. Call our office today at (800) 681-1295 to set up a consultation.
We Are Here for You
Regardless of your business or estate needs, the professionals at the Tax Law Offices of David W. Klasing are here for you. We are open for business and our team will help ensure that your business is too. Contact the Law Offices of David W. Klasing today to discuss your business with one of our professionals.
In addition to our main office in Irvine, the Tax Law Offices of David W. Klasing has unstaffed (conference room only) satellite offices in Los Angeles, San Bernardino, Santa Barbara, Panorama City, Oxnard, San Diego, Bakersfield, San Jose, San Francisco, Oakland, Carlsbad and Sacramento. During the COVID-19 pandemic, our staff are working from home, but have full virtual meeting capability.
Our office technology allows clients to meet virtually via GoToMeeting. With end-to-end encryption, strong passwords and top-rated reliability, no one is messing with your meeting. To schedule a reduced-rate initial consultation via GoToMeeting follow this link. Call our office and request a GoToMeeting if you are an existing client.
Questions and Answers on Unfiled Back Taxes
- What are the common issues that non-filers face?
- Risk of audit after filing delinquent prior year returns
- Can substitute return deficiency be discharge in bankruptcy
- Substitute return modified by subsequent delinquent return?
- Do I file every delinquent return for each missing year?
- How does the IRS identify non-filers?
- How important is it to the government that I didn’t file?
- Delinquent tax return criminal prosecution likelihood
- Will I get a refund on a delinquent tax year?
- What happens after enforcement action has begun?
- Should I use an attorney, EA or a CPA to represent me when I re-enter the tax system?
- Why do people drop out of the tax system?
- What happens after the IRS identifies me as a non-filer?
- IRS has not previously filed substitute returns
- Tax attorney representation when re-entering tax system
- How will the government force me to file returns?
- What penalties can IRS impose on delinquent tax filings?
- What should I do to re-enter the tax system?
- Can Law Office of David W. Klasing help me re-enter system?
- Will tax collection taken by authorities affect my credit
- I concealed bank accounts from the government
- Forgetting or failing to file tax return
Questions and Answers about Offshore Voluntary Disclosure Initiative (OVDI) (CANCELLED)
- Why hire David W. Klasing to represent me in an audit
- 2011 Offshore Voluntary Disclosure Initiative FAQ
- Key Features of Initiative
- Eligibility For This Initiative
- 2011 OVDI Process
- Calculating The Offshore Penalty
- Statute of Limitations
- FBAR Questions
- Taxpayer Representatives
- Case Resolution
- What not to do!
- What to do!
- FBAR Reporting and Expired Voluntary Disclosure Program
- How the Law Offices of David W. Klasing Can Help
- Bank account overseas I didn’t report on my income tax
- Do I have to maintain information on overseas bank accounts
Questions and Answers about FBAR Compliance and Disclosure
- Potential charges for not participating in the 2014 OVDP
- How many tax returns will I amend for my FBAR filing?
- FBAR Voluntary Disclosure program end
- Can I make a voluntary disclosure after the deadline?
- Can I use IRS Voluntary Disclosure if I Can’t Pay?
- Potential reporting requirements and civil penalties
- What Happens if You Don’t Disclose Foreign Accounts
- Criminal charges if you refuse voluntary disclosure
- Characteristics of FBAR voluntary disclosures
- What is required to make a valid voluntary disclosure?
- 2012 Offshore Voluntary Disclosure Initiative Objectives
- What is an FBAR?
- Filed amended returns without making a Voluntary Disclosure
- Undisclosed foreign accounts: What exchange rate to use
- Why did the IRS announce the 2012 OVDI at this time?
- Should I consider making an offshore voluntary disclosure?
- Why to consider making a Voluntary Disclosure
- 2012 OVDI program vs. the voluntary disclosure practice
- Foreign bank account asset reporting/filing requirement
Questions and Answers About Foreign Tax Audits
- Does the Fifth Amendment apply to foreign accounts?
- How is evidence cultivated from foreign sources?
- How is tax loss determined?
- How might an FBAR audit be resolved?
- Is a penalty assessment ripe for judicial review?
- Overview of an administrative criminal investigation
- What is the process of an FBAR referral?
- Statute of Limitations raised during a FBAR audit?
- Precautions to be taken in the pre-audit phase
- Recent international tax and reporting prosecutions
- Foreign account, entity and investment prosecution
- Who collects restitution and penalties?
- International tax investigations are an IRS high priority
