How criminal exposure usually surfaces
Many criminal tax matters start as something else: a civil examination that turned up concealed income, a whistleblower complaint, a bank report, or a separate investigation into a business. A grand jury subpoena to a bank, a preparer, or a former employee is often the first sign, and a target letter, when one is sent, signals that prosecutors view you as a likely defendant. Sometimes there is no signal at all until agents arrive. Investigations may be federal, may come from the New York State Department of Taxation and Finance, or may involve both.
Accountants, documents, and statements
Your regular preparer can become a witness, and communications with an accountant are generally not privileged in a criminal case. When accounting help is needed, a lawyer can retain an accountant to work under the lawyer's direction, which in many circumstances brings that work within the attorney-client privilege. Documents covered by a subpoena must be preserved, and destroying or altering records after learning of an investigation can become a separate crime. Talking to agents is your choice, but knowingly false statements to federal agents are a crime of their own, so many people decline and communicate through counsel. A request to speak informally, even a friendly one, is still part of the investigation.
Options before charges
Before an indictment, a lawyer can sometimes learn the government's theory, present information or explanations to prosecutors, and in some matters argue that a civil resolution is more appropriate. Whether to do that depends on what the evidence shows, because anything you provide can be used. In our first meeting we go over every contact with agents and every subpoena so far, who else has been approached, and whether a civil audit is running in parallel, then set immediate steps for documents and communications. We also talk through who in your family or business may need separate counsel.
