An eggshell audit is a civil IRS audit in which a taxpayer has a potentially serious tax issue. This is often a criminal matter, which makes it a serious and complex issue to handle. A small misstep could lead to a criminal referral, which is why this kind of case is called an eggshell audit – the individual is walking on eggshells. For instance, a small business owner may have omitted offshore income. They may face an eggshell audit.
Hiring a Richmond eggshell audit lawyer is crucial. This process can be difficult without assistance from an IRS audit lawyer, which is why you should get assistance with this process. Here are a few things you need to know before you find yourself in a difficult situation.
One of the biggest reasons to hire an eggshell lawyer in Richmond for tax issues is if you know that there could be an issue with your taxes, even if the IRS currently seems unaware of any past misconduct. This is also the case if a taxpayer receives an audit that seems either unusually broad or extremely focused. For instance, the IRS may express interest in auditing cryptocurrency specifically.
It is also a good idea to pursue legal counsel if you were previously under criminal investigation or have submitted inaccurate returns in prior years. For instance, a taxpayer may have failed to report several years of income from cryptocurrency transactions. An IRS audit letter may request documentation that indicates they are beginning to search for more information.
There is a thin line between civil and criminal audits. Knowing the difference is crucial. Civil audits are focused on recovering unpaid taxes, whereas criminal audits investigate fraud and intent to defraud, ultimately leading to prosecution. An eggshell audit straddles the line of civil and criminal, which is why having a solid legal strategy is so important.
Real risks come with audit escalation. For instance, the IRS could detect falsehoods in the reports and quickly turn the investigation into a criminal one. A Richmond eggshell audit attorney will create a legal strategy before the investigation becomes escalated. We can tell the taxpayer what to disclose and how to answer questions. We can also provide information about when to stay silent to help a civil audit from developing.
Apart from developing a legal strategy, a Richmond layer can also assist with other aspects of an eggshell audit. We provide help with communication control and document review. We ensure that nothing incriminating is handed over without a thorough legal review. A lawyer also negotiates with the IRS to avoid referral to the Criminal Investigation Division. A lawyer intervenes before a client accidentally admits to willful nondisclosure.
Local representation matters. An attorney in the region is familiar with local IRS offices and procedures, and we can also provide insight into Virginia-specific tax nuances. Our attorney can also collaborate with Richmond-area accountants.
Immediately upon receiving an audit notice, it is a good idea to call an attorney. You should also contact an attorney if you believe past filings have been incomplete or inaccurate or you believe the IRS is already suspicious of criminal conduct. Even if an accountant is uncertain about contacting an attorney, you should seek legal help.
In an eggshell audit, the stakes are high. One misstep can shatter everything. Prompt legal help is critical. Contact an experienced Richmond eggshell audit lawyer today to safeguard your rights and your financial future.