Legal Question in Tax Law in Illinois

The first question would be: do you know of a reason you would be under investigation? Next, who told you? Normally, the IRS will contact you regarding taxes. Have you ignored any IRS correspondence in recent months?

There's no way to tell if you're under investigation. If an IRS investigation (or some other federal or state agency) targets you as a potential criminal defendant, you'll know when they show up and read you your rights. If you have an uneasy feeling about something you may have done or failed to do, maybe you need to seek professional advice on how to mitigate the consequences.

After identifying a potential target, but before showing up for the typical "ambush interview," Special Agents of the IRS Criminal Investigation Division do as much background work as possible. This allows them to get the most out of the interview when they finally do show up. They know that this initial surprise interview is often the only chance they will get to talk to the taxpayer (and to get damaging admissions) because once they've read the taxpayer his rights, he or she will retain counsel who will thereafter prevent the taxpayer from talking to the Agents. Even after being read their rights, however, most taxpayers talk -- for hours. And the Special Agents love it (I know, since I used to conduct these interview when I was at the IRS, and I was always amazed that taxpayers would talk so freely, having been informed that our purpose was to determine whether they had committed a criminal violation of the law, that they didn't have to answer our questions, and that they had the right to retain an attorney). But short of calling up the IRS Criminal Investigation Division and asking them, there's no reliable way to know whether you are under investigation until two Special Agents (and they always travel in pairs) show up on your doorstep.

If you want more information on the IRS criminal investigation process, there's an article I wrote about it posted on my website at http://www.bjhaynes.com/articles_tax_fraud.php. And if you want to see examples of the kinds of cases the IRS prosecutes, you can check out the latest news releases on the IRS's website at http://www.irs.gov/newsroom/content/0,,id=137869,00.html.