New IRS:CI Annual Report: What’s New in Tax Crime Enforcement

tax reportEach year, the Internal Revenue Service Crime Investigation (IRS:CI) unit releases its annual report. The report provides an inside look at the priorities, practices, and success rates of IRS:CI endeavors to reduce tax crime and encourage compliance.

 

The 2023 report is focused on financial crime and associated investigations, like tax fraud.  Notes IRS Commissioner Danny Werfel, “Criminal Investigation's work has identified tens of billions of dollars on issues including tax fraud, money laundering and cybercrimes. The work of Criminal Investigation employees – who often put themselves in harm's way to get the job done – continues to make a difference in helping uphold tax laws and protect taxpayers."

 

IRS:CI operates 20 field offices in the U.S. with additional postings abroad. Here are some data findings from the 2023 IRS:CI annual report:

  • IRS:CI spent approximately 69.9 percent of its time pursuing tax crimes in 2023. Types of tax fraud include corporate, refund, and general tax fraud, abusive tax schemes, international and cybercrime, employment tax crime, public corruption, and identity theft.
  • IRS:CI also partners with the Organized Crime Drug Enforcement Tax Force, which occupied approximately 11.3 percent of their time in 2023. Non-tax crimes like money laundering and general fraud accounted for the balance of time spent by the unit that year.
  • The budgetary boost from Congress allowed for an increase in staffing for IRS:CI. In 2022, the unit had 2077 Special Agents, whereas in 2023, there were 2144. Professional staff also received a boost of 56 hires.
  • Of $31.6 billion in financial crimes identified, tax fraud represents $5.5 billion of that total.  The unit executed 1,334 warrants.
  • A metric of considerable concern each year is the number of matters referred and prosecuted together with the conviction rate. Last year, 1,838 individual cases were referred for prosecution upon which IRS:CI had an 88.4 percent conviction rate. Of those, 1,508 individuals were convicted.
  • On tax crimes alone, 1,409 IRS criminal tax investigations were undertaken which resulted in a recommendation to prosecute 665 of those individuals. Of that smaller group, 655 were sentenced.

 

For individuals engaged in tax fraud, theft of employment taxes, or other tax crimes, these are sobering statistics. The IRS:CI follows the money, regardless of its form, how many times it is laundered, or where in the world it goes. If you are concerned about a compliance issue, or aware that your taxes are amiss—speak with an experienced criminal tax attorney before the IRS speaks to you.

 

Involved in a potential tax crime? Our tax attorneys can help

When you receive notice of an IRS investigation or audit, skilled legal representation is important. With offices in Cleveland and Chicago, the legal group at Robert J. Fedor, Esq., LLC provides strategic, discrete guidance on criminal tax matters, offshore tax concerns and business bankruptcy. Contact us today or call 440-250-9709.

 

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