As we move through the second full month of stay-at-home orders and social distancing guidelines required as a part of the response to the COVID-19 pandemic, we are getting better visibility into the impact on criminal tax investigations and prosecutions. Although the number of indictments and resulting prosecutions have decreased, this is not the time for those out of tax compliance to declare victory. Once the country resumes relative normalcy, we are likely to see a tremendous uptick in the number of criminal tax investigations and prosecution. Those who have failed to file tax returns or have taken positions on tax returns that cannot be supported should take this time to come into tax compliance. The best way to begin that process is to contact an experienced tax attorney.
Grand Juries Not Convening, Causing Decrease in Indictments
According to multiple news agencies, the Department of Justice has seen a significant drop in criminal tax prosecutions. This is primarily due to the fact that federal grand juries are not regularly sitting to issue indictments. The grand jury indictment is the primary method that the Department of Justice utilizes to kick off a criminal tax prosecution. Prosecutors will occasionally use a criminal complaint to officially charge a defendant, which requires the showing of probable cause to a federal judge. But because the use of criminal complaints has not increased to compensate for the lack of grand jury indictments, the net amount of criminal tax prosecutions has seen a significant drop.
The Department of Justice has further indicated that they are shifting their resources to focus on prosecutions relating to violent crime, terrorism, national security, and the exploitation of children. Additionally, the Department of Justice is working toward investigating and prosecuting matters relating to the COVID-19 pandemic, such as the hoarding of medical supplies and the sale of fake medicine.
Using This Time to Come into Compliance
Looking to the future when the Department of Justice returns to quasi-normal operations, the number of tax investigations and prosecutions will skyrocket. Those who have failed to file a tax return or have taken an unsupportable position on their tax return should seriously consider taking this time to get right with the government.
Those individuals and businesses who may be out of tax compliance should work with an experienced tax attorney to first determine the extent of the tax liability due to the tax noncompliance and then develop a plan of action to remedy the situation. Your tax defense attorney will assist in the preparation of any documentation that is required to execute any plans to come back into compliance and represent you in any interactions with state taxing authorities, the IRS, or the Department of Justice.
We Are Here for You
Regardless of your particular 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.
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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