IRS Criminal Investigators are looking for what we call badges of fraud. They’re looking for circumstances that would be clear indicators that the taxpayer committed a willful violation of our country’s tax laws. So tax evasion, willfully failing to file a tax return or any other number of tax crimes. Badges of fraud are things like concealing records, destroying evidence, lying, falsifying documents, doing things to conceal or evade investigations. Those are the things that CI is looking for. Criminal cases depend on willfulness. The standard of proof in a criminal case is beyond a reasonable doubt so criminal investigators are really seeking a very high bar to try and prove beyond a reasonable doubt that someone is guilty of a tax crime. So they’re building and they’re digging in and they’re getting lots of evidence to support that somebody fraudulently committed a violation and that’s what’s really important because they spend a lot of time digging into these badges of fraud and interviewing people and gathering documents to support their case. They’re trying to paint you in the worst light possible, because they want to leave no doubt, they want to leave no stone unturned in showing that you’re a bad guy and that you deserve a criminal conviction. So that’s what they’re looking for. They’re developing a case not only around the actions that were taken but trying to pigeonhole the intent that you had in committing those actions and that’s what they’re really going after and the focus of most IRS Criminal Investigations.
