Every tax practitioner who has represented clients for more than a few years has been approached by a scared client who has received an audit letter and who confesses that his or her tax returns were less than accurate. The failure to understand best practices in an eggshell audit can result in the client being assessed a 75% civil fraud penalty or worse, criminal prosecution, and ultimately a trip to the federal penitentiary.
An eggshell audit is a civil tax audit in which the taxpayer has filed a false tax return. If the falsity comes to light then there is possibility that the IRS can refer the case for criminal investigation, and ultimately criminal prosecution. Because of the sensitivity of the issues and the potential for disatrous results, anyone involved in the audit must walk on eggshells. Hence the term "eggshell audit."
On Wednesday, May 6th, I'll be giving a webinar for Bloomberg BNA. Please tune in at 10 a.m. PT to "Eggshell Audits: Keeping Your Client Out of Jail" to find out more information about:
1. Telltale signs if the revenue agent is
considering referring a civil case to
the Criminal Investigation Division
2. Techniques the practitioner can use
to minimize the risk if a civil audit
will turn criminal
3. What to do about the filing of current
tax returns during an eggshell audit.
If you have any tax problems, call the tax litigation attorneys at Brager Tax Law Group, A P.C.
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Please do not hesitate to contact me if you have any questions.