1. The First Agency Contact Determines the Immediate Response
An audit letter, investigator's visit, or records demand requires different action. Identify the agency, cited authority, and whether a response is compulsory.
Identify the Agency and Investigation Stage
An IRS revenue agent may examine a return without alleging a crime, a matter addressed through IRS audit defense. IRS Criminal Investigation (IRS-CI) special agents investigate suspected offenses. California's Franchise Tax Board (FTB) investigates state income-tax fraud, while the California Department of Tax and Fee Administration (CDTFA) oversees sales and use taxes. Each agency operates under different legal requirements.
Distinguish Interviews from Summonses and Subpoenas
An interview request differs from an IRS summons under 26 U.S.C. § 7602 or a grand jury subpoena. Formal process may require testimony or records by a deadline. An attorney can assess the demand and possible objections or privileges. A person cannot disregard compulsory process simply because an interview would be voluntary.
Protect Rights and Check Immediate Deadlines
Individuals can seek legal advice before answering voluntary questions. The Fifth Amendment may protect against compelled self-incriminating testimony but does not erase all document duties. Keep original notices, investigator details, and notes of earlier statements. Verify appearance dates and locations before responding.
2. Federal and California Tax Charges Follow Different Laws
The tax involved, the alleged act, and the required intent determine the potential offense. An unpaid balance alone does not establish a crime. Prosecutors must prove the elements of the charged offense.
Review Federal Tax Allegations
Under 26 U.S.C. § 7201, tax evasion involves a willful attempt to evade or defeat tax. Section 7206(1) concerns willfully signing a materially false return under penalties of perjury, without requiring a tax deficiency. Willful failure to file under § 7203 is distinct. The existing criminal tax defense page covers these offenses further. A case review starts with the suspected provision and relevant tax years.
Separate California Income-Tax Offenses
FTB's Criminal Investigation Bureau investigates suspected income-tax crimes and may refer cases to district attorneys or the California Attorney General. Revenue and Taxation Code § 19705 makes specified willfully false tax documents and assistance with fraudulent filings felonies. Section 19706 covers certain willful filing failures or false statements made with intent to evade tax. The charge affects potential misdemeanor or felony treatment and penalties.
Examine Sales and Use Tax Allegations
A business accused of concealing taxable sales may face a CDTFA investigation. Under Revenue and Taxation Code § 7153.5, intentional tax evasion is a felony when unreported tax liability reaches $25,000 over any 12 consecutive months. Register records, payment processor statements, and filed returns help assess the amount and alleged intent.
3. Los Angeles Court Proceedings Depend on the Charges Filed
Federal and California prosecutions follow different court procedures. Check the complaint, indictment, or summons before treating an investigation as a filed criminal case.
Federal Charges in the Central District
Federal tax charges with proper venue in the Central District of California proceed in U.S. District Court. After an arrest or summons, Federal Rule of Criminal Procedure 5 governs the initial appearance, while Rule 10 addresses arraignment. The court's published Los Angeles notice identifies Courtroom 640 at the Edward R. Roybal Federal Building for criminal initial appearances. Verify the current assignment and hearing date in the court papers.
State Charges in Los Angeles Superior Court
California criminal charges filed in Los Angeles County proceed in Los Angeles Superior Court. A criminal complaint lists the allegations, and arraignment addresses the charges and plea. Felonies and misdemeanors may follow different hearing schedules. Confirm the assigned courthouse, case number, court date, and release conditions. An FTB investigation alone is not a filed court case.
Check Court Records and Separate Civil Disputes
Public federal filings may appear on PACER. Los Angeles Superior Court provides criminal case summaries and hearing information, but sealed and investigative records may be unavailable. A deficiency notice or civil assessment is not a criminal charge. Related tax controversy litigation may involve different courts, filing procedures, and deadlines.
4. Criminal Tax Case Review Connects Records to Individual Conduct
An attorney examines who supplied financial figures, approved tax returns, and controlled payments. Job title alone cannot establish criminal intent, especially when several people participate in preparing a business return.
Reconstruct Filing and Payment Decisions
Compare original and amended returns with bank transactions, ledgers, payroll records, invoices, and electronic filing authorizations. Accountant emails can identify who supplied disputed figures or requested corrections. Owners' approvals and employees' access logs may establish different responsibilities. The attorney must connect each record to the conduct alleged.
Preserve Digital Records and Assess Privilege
Do not erase messages, overwrite accounting files, or backdate corrections. Relevant data may sit in cloud systems or employee devices. Proper evidence preservation helps maintain record integrity. Accountant communications are not automatically protected by attorney-client privilege, so legal protections and disclosure obligations require review before sensitive material is produced.
Plan the Defense at the Correct Stage
Before charges, an attorney may address interviews, subpoena responses, and communications with investigators or prosecutors. After charges, the defense shifts to discovery, motions, hearings, and plea or trial options. If the business and its owner have competing interests, separate attorneys may be necessary. Clarify who is represented before making substantive disclosures.
09 Nov, 2026
