Beware of IRS Special Agents Asking About Offshore Bank Accounts (Golding & Golding)
Beware of IRS Special Agents Asking About Offshore Bank Accounts
IRS special agents are a sneaky bunch.
The agents move pretty stealthily through the pre-investigation face in order to compile enough information to determine whether or not they want to further investigate and “interview” you.
This may mean interviewing your Bank, CPA, or other professional – without your knowledge.
Interview is more of a misnomer, because in reality when they confront you, it will feel more like an interrogation.
Their goal is to obtain enough information sufficient to make their case, along with a recommendation for criminal prosecution.
No matter how slick you are, or how good you are with your words it is never — in the history of the world — a good idea to speak with the IRS special agents.
This is especially true when the matter involves offshore and foreign related matters.
Contents
First, You Need an Attorney
We stress attorney instead of a CPA or other tax professional, because your livelihood and liberties may be at risk — and therefore you should have the confidentiality that you can only get with the attorney-client privilege (ideally, a dually-licensed Attorney/Enrolled Agent or Attorney/CPA).
You Didn’t Know You Were Under Investigation?
Welcome to the element of surprise – and the IRS Special Agents use this tactic well. For some of our luckier clients who have established relationships with their banks, they may get tipped off and have the opportunity to transfer the money out of their accounts before the IRS has a chance to seize it.
Not all clients are that lucky.
How do the IRS Special Agents Approach You?
As with everything bad (or annoying) in life, it happens when you’re not ready, generally minding your own business – and otherwise enjoying a nice day out with family and friends.
The first time you may come to the realization that you have even been under investigation is when one, two, or 10 unmarked vehicles arrive at your home, sitting in front of your driveway – warrant in hand. (We’ve been called to these scenes, so we can tell you this does really happen.)
With that said, most situations with the IRS Special Agents are not that intense. Generally, the Agents do a bit of snooping, get enough information to make you feel uncomfortable – and two of them approach you when you least expect it – and begin asking you questions.
Since penalties for non-disclosure of offshore accounts, assets, investments and income is at an all-time high, it is important that you do not divulge any information that can be used against you.
You are Not Under Arrest
The IRS agents represent the quasi-criminal faction of Internal Revenue Service. Their job is to determine whether they believe you should be referred for further criminal investigation and/or prosecution.
But, they are not police officers — and you are not under arrest.
Their job is to get you to talk (outside of the presence of an attorney). They accomplish this by trying to make you feel scared and uneasy enough that you feel like you want to talk.
Still, you should not talk to them.
Nothing you tell IRS special agents when you are under duress or pressure is going to sound as convincing as you believe it sounds in your own mind. And, they are going to find a way to use it against you.
Their job is not to allow you to try to talk them out of the investigation; that is not how they get results.
Their job is to find enough evidence to want to puruse to a more formalized investigation and referral for criminal prosecution.
What Should You Do if Confronted by IRS Special Agents?
You should be absolutely respectful to the IRS Special Agents. This is their job, and “usually” nothing personal.
As in business and life, being disrespectful will get you nowhere fast. It is never a good idea to make it personal.
Disrespecting a Special Agent who is just doing their job is the same as disrespecting an elder, a business or athletic competitor, or ex-sweetheart – it is most likely going to result in you receiving the brunt of that person’s ire — which can have unintended consequences you may have not have fully contemplated before acting disrespectful.
And, you surely do not want a special agent who has the power to refer you for a potential criminal prosecution to feel slighted or disrespected – just for doing his or her job.
Rather, you politely tell the agent that you are going to contact an attorney, request their business card, and remove yourself from the scene.
With IRS international and offshore compliance and enforcement at an all-time high, it is important to retain an experienced attorney to help you with both your legal and tax situation.
What Can You Do?
Presuming the money was from legal sources, your best options are either the Traditional IRS Voluntary Disclosure Program, or one of the Streamlined Offshore Disclosure Programs.
Golding & Golding, A PLC
We have successfully represented clients in more than 1000 streamlined and voluntary disclosure submissions nationwide, and in over 70-different countries.
We are the “go-to” firm for other Attorneys, CPAs, Enrolled Agents, Accountants, and Financial Professionals across the globe.