The Internal Revenue Service (IRS) recently released the fiscal year 2017 annual report for its Criminal Investigation Division (CI). During FY 2017, CI initiated over 3,000 cases concerning Title 18 and Title 31 crimes, with 72.5% of its investigation time spent on tax matters such as refund fraud, identity theft, abusive tax schemes, and cyber crimes. Its investigations identified $2.5 billion in funds related to tax fraud, and the division had a 91.5% overall conviction rate.
In California, CI investigations lead to the sentencing of numerous taxpayers. For example, one Sacramento man was ordered to serve 51 months in prison for filing false tax returns and claiming over $860,000 in false refunds. A tax preparer, also from Sacramento, was sentenced to 120 months in prison, two years of supervised release, and restitution of more than $9.5 million for filing false tax returns and claiming undue refunds for his clients across 26 states. A Bay Area doctor was sentenced to 37 months in prison, three years of supervised release, a $75,000 fine, and over $5.4 million in restitution for tax evasion.
New this fiscal year to CI is the Nationally Coordinated Investigations Unit, which will partner with agents and analysts to supplement field office activity to address non-compliance in areas such as microcap stocks, employment tax, banking, and biofuel tax credit schemes.
To read more about the IRS’ criminal investigation activities, click here.