IRS Admits it Wrongfully Picks At Least 1 Person Each Day to Put Under Criminal Investigation


The Infernal Revenue Service (sorry, Internal Revenue Service), released its “stat book” for fiscal year 2011, (found here:, on IRS criminal investigations initiated, IRS criminal investigations completed, IRS criminal investigations referred for prosecution, IRS criminal investigations “completed without prosecution” (e.g., the IRS “got it wrong” again about another innocent person wrongfully put under IRS criminal investigation), IRS criminal indictments, IRS criminal convictions, IRS criminal sentences, IRS criminal investigations that led to incarcerations, and other partially useful data from that most “impartial” agency.

Here’s an excise of the data:

IRS Criminal Investigations (Legal Source Tax Crime Investigations; e.g., not drugs or mobsters)

Investigations Initiated: 1,922

Investigations Completed: 1,842

Referrals for Prosecution: 1,160

Investigations Completed Without Prosecution: 682

Aside from the sleight-of-hand deception utilized in the statistics (using last year’s referrals for prosecution as if it was a subset of the investigations initiated within the year, when it's not from the same dataset), the general pattern reveals a dangerous uptick in IRS criminal investigations resulting in referrals of ordinary individuals for criminal prosecution. What does that entail? According to the same data, a 90 percent chance of conviction at trial and an 80 percent chance of prison time with the average sentence as long as that of a violent criminal in many state – several years in prison. But note, such results for people with typical defenses and typical lawyers are not the same as our results. Most of our IRS criminal investigation clients experience a different outcome – vindication and freedom, not prison time.

According to the data, the IRS closed criminal investigations for 1,842 individual and ordinary Americans last year. The IRS referred 1,160 of them to the Department of Justice for criminal prosecution and recommended prison time. So basically, your chances in 2011 of a criminal prosecution once an investigation opened was about a 2-in-3.  (Not at Barnes Law, where 0 percent of our clients last year were indicted, and where the prosecution rate remains low for all clients under IRS criminal investigation who retain Robert Barnes over his entire career.)

Upshot: the declination rate (technical term for when the government admits they got the wrong guy) continues to go in the wrong direction — declining — while the prosecution rate rises. This ain’t Springsteen’s Rising; this is Johnny Cash’s 3-feet-high-and-rising, here-comes-the-flood kind of rising.

My Take: Do you think the IRS suddenly got better at wrongfully targeting the innocent? Or do you think prosecutors are too dim-witted to know the difference between a good and bad IRS criminal tax case? I’m betting on the latter in the oar-less, leader-less, and often clueless Tax Division of the Department of Justice these days.

Wrap-up: Now that 67 percent chance of your investigation turning into a criminal prosecution may sound scary, but remember – that’s for all people with all kinds of attorneys defending them, and some with no attorney at all. At Barnes Law, the past is not always prologue and no result can be guaranteed. (Well, maybe the fact the IRS will wrongfully put at least one innocent person under investigation again today, like it does at least once every single day by their own admission, is still a guarantee.) But we expose the facts, document the truth, and show why no sane or moral prosecutor would want to prosecute our clients. That’s why our clients’ continue to see better and better declination rates, and most of our clients who hire us while under the threat of an IRS criminal investigation are never prosecuted and never see the inside of a prison cell. They get the freedom and vindication they deserve. When the truth wins out, you win out. And we bring the truth to the IRS, whether they like it or not. Barnes Law – Because Results Matter.