A tax evasion investigation often begins well before formal charges are filed, making it essential to identify the early warning signs. Financial investigators are trained to spot specific red flags in tax filings and other documentation. While one error might not be enough to trigger scrutiny, the likelihood of a tax audit or a full IRS criminal investigation significantly increases when investigators discover multiple errors or discrepancies.
Recognizing the warning signs of an upcoming tax evasion investigation in Baltimore can help you take proactive steps to get legal help right away. If you are worried about a criminal tax investigation or IRS tax audit, act now to protect yourself by consulting an experienced tax evasion attorney at Whiteford Tax Defense.
The Internal Revenue Service, or IRS, has the authority to investigate various financial crimes through its federal law enforcement criminal division, including tax evasion in Baltimore. They investigate related financial crimes that negatively impact tax administration, including money laundering, currency transaction violations, tax-related identity theft fraud, and terrorist financing, as well as potential violations of the Internal Revenue Code.
IRS agents who are in charge of tax audits are called revenue agents. They are trained to be on the lookout for specific indicators of tax fraud. Even more serious are IRS law enforcement agents who open criminal investigations. Usually, there are warning signs that both types of agents have become interested in a particular target. Paying attention to these warning signs means that a target who is under investigation for tax evasion in Baltimore or may be soon can hire legal help right away to begin mitigating the damage.
The first warning sign is unusual IRS communications. If a person or business receives a letter or other communication from the IRS, it is important that they review it carefully and take note of any out-of-the-ordinary requests. If there are repeated IRS inquiries or requests for documentation, these are other key indicators that agents are becoming suspicious of certain activity. It is important to save all IRS communications, whether emails, letters, or other forms of communication, especially audit notices.
Sudden account freezes are another important warning sign. If investigators believe a person or a business may be withholding taxes that they owe or misrepresenting information on their tax filings, freezing their accounts can prevent them from moving money around and further concealing what is really going on.
The final and most obvious warning sign is a visit or contact directly from a federal investigator. If these investigators are taking the time to physically visit a home or workplace, it is likely that they have already begun an investigation into that person or business and are working to build their case. Agents may question targets directly, attempt to access their financial records, or try to obtain statements that can later be used in a trial. It is critical to seek expert legal advice at this stage to prevent self-incrimination and to avoid making things worse than they may already be.
Unfortunately, simply ignoring warning signs of an upcoming tax evasion investigation will not make the problem go away. When the IRS believes it has gathered enough evidence to charge someone with tax fraud, they can refer the case to the Department of Justice. At this point, officials can decide to press felony charges that can mean serious fines and prison sentences.
If you have noticed any of these warning signs of an upcoming tax evasion investigation in Baltimore, you need legal help now. Contact us today.