IRVINE, Calif., May 27, 2020 /PRNewswire/ -- As we move through the second full month of stay-at-home orders and social distancing guidelines required as a part of the response to the COVID-19 pandemic, we are getting better visibility into the impact on criminal tax investigations and prosecutions. Although the number of indictments and resulting prosecutions have decreased, this is not the time for those out of tax compliance to declare victory. Once the country resumes relative normalcy, we are likely to see a tremendous uptick in the number of criminal tax investigations and prosecution. Those who have failed to file tax returns or have taken positions on tax returns that cannot be supported should take this time to come into tax compliance. The best way to begin that process is to contact an experienced tax attorney.
Grand Juries Not Convening, Causing Decrease in Indictments
According to multiple news agencies, the Department of Justice has seen a significant drop in criminal tax prosecutions. This is primarily due to the fact that federal grand juries are not regularly sitting to issue indictments. The grand jury indictment is the primary method that the Department of Justice utilizes to kick off a criminal tax prosecution. Prosecutors will occasionally use a criminal complaint to officially charge a defendant, which requires the showing of probable cause to a federal judge. But because the use of criminal complaints has not increased to compensate for the lack of grand jury indictments, the net amount of criminal tax prosecutions has seen a significant drop.
Using This Time to Come into Compliance
Looking to the future when the Department of Justice returns to quasi-normal operations, the number of tax investigations and prosecutions will skyrocket. Those who have failed to file a tax return or have taken an unsupportable position on their tax return should seriously consider taking this time to get right with the government.
Those individuals and businesses who are out of tax compliance should work with an experienced tax attorney to first determine the extent of the tax liability due to the tax noncompliance and then develop a plan of action to remedy the situation.