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Effective tax defense counsels goals in an egg shell audit?

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Effective tax defense counsels goals in an egg shell audit?

In the typical eggshell audit criminal tax defense counsel seeks to avert the emergence of a criminal investigation, by attempting to prevent a client from making any criminal admissions. In a reverse eggshell audit, they endeavor to discover any ongoing clandestine criminal tax proceeding and possibly limit the taxpayer’s cooperation in order to protect the taxpayer from criminal prosecution by protecting their constitutional rights against self-incrimination and unreasonable search and seizures.

Criminal tax defense attorneys representing a client in an eggshell audit commonly seek to achieve three overarching goals;

1. To prevent a criminal investigation from beginning by attempting to keep a matter purely a civil examination.

2. Avoid the imposition of civil fraud penalties that are possible under IRC § 6663 which imposes a 75% penalty on any portion of an underpayment that is attributable to fraud.

3. Minimize additional tax, penalties and interest.

4. Minimize the number of tax years that come under audit.