Should You Ever Refuse to Cooperate in a Criminal Tax Investigation?

No one wants to end up on the IRSs naughty list. But if you should find yourself under the microscopic lens of the IRS, you definitely want to have tax attorneys offering complete solutions to your tax problems on your side. An experienced attorney can help you navigate the tax system and help you decide if you can or should refuse to cooperate in a criminal tax investigation.

What is a Criminal Tax Investigation?

A criminal tax investigation is conducted by the IRS (Internal Revenue Service) to look into potential criminal violations of the Internal Revenue Code and other financial crimes. When a person or a business purposely decides that they are not going to abide by the taxation laws, there is the risk of facing a civil audit or criminal investigation. Both an audit and criminal investigation can end with prosecution, fines or jail time.

Why Are You Being Investigated by the IRS?

The American taxing system relies on voluntary compliance. This means that citizens bear the burden of self-assessments regarding their amount of owed taxes. All income, legally or illegally obtained, is taxable. Persons and businesses that are attempting to circumvent the tax laws and codes raise questions as to further unlawful activity. Some of the more common reasons you may get investigated include:

Can You Refuse to Cooperate in a Criminal Tax Investigation?

You can refuse to cooperate with an IRS investigation. When you or your business is under investigation, you will have multiple chances to choose to cooperate or not with the IRS special agent. The decision to cooperate or not should be taken lightly. Each can have serious consequences. Quite often the decision to cooperate can be synonymous with making a confession.

There are also levels of cooperation. You can fully cooperate, giving the special agent assigned to your case anything and everything they request of you. This is often done when there is not enough evidence against you or if there truly is no wrongdoing or misconduct. There is also selective cooperation, where you agree to cooperate to a certain degree; or only in certain aspects of the criminal investigation. If your attorney deems your case is not defensible, you may fully or selectively cooperate with the hope that you will receive a more lenient punishment or penalty in return.

Then there is the absolute refusal to cooperate. There are circumstances where it is best not to cooperate. This may be your choice is there is little to no advantage to your cooperation. It is important to be realistic and objective when deciding whether or not to cooperate. And the decision should almost always be decided after consulting with an experienced attorney.

Your cooperation with a special agent is not likely to make the investigation go away or keep you out of trouble, but it may change the way the investigation is conducted or the harshness of any assessed penalties or sentences. Choose wisely and carefully.