How to Detect IRS Surveillance and Undercover Operations

How to Detect IRS Surveillance and Undercover Operations

Dealing with the IRS can be stressful under normal circumstances. But if you suspect you may be the target of an IRS surveillance or undercover operation, it can be downright frightening. While the IRS conducts hundreds of undercover operations each year[4], there are some signs you can watch out for to determine if you are being monitored or investigated in secret.

What Triggers an IRS Undercover Operation?

The IRS Criminal Investigation division handles undercover operations. These covert investigations aim to gather evidence of criminal violations of tax laws, such as tax evasion or filing false returns[1]. Some reasons the IRS may initiate an undercover operation include:

• Evidence or suspicion of tax fraud exceeding $2,500
• Failure to file tax returns or pay taxes owed for multiple years
• Suspected involvement in illegal tax shelters or abusive schemes to avoid taxes
• Suspected false W-2s filed for fictitious employees
• Suspected employment of undocumented immigrants without proper payroll tax payments

So if you are engaged in any dodgy tax-related activities, be aware the IRS may plant undercover agents to secretly gather evidence against you.

How the IRS Conducts Undercover Operations

IRS undercover operations involve agents assuming false identities or disguising their real purpose[1]. Some techniques IRS agents may use include:

• Posing as accountants, attorneys, or financial advisors to get information from you
• Pretending to be a customer or client to observe your business practices
• Making undercover purchases of goods or services from your business
• Secretly recording conversations with you or your employees
• Infiltrating a suspected criminal organization to gather tax evidence

The IRS can also conduct undercover operations online by creating fake identities on social media sites or message boards related to tax fraud topics[6].

How to Detect IRS Surveillance

In addition to undercover operations, the IRS also conducts surveillance to gather information without direct contact[2]. Some signs you may be under physical surveillance include:

• Seeing the same suspicious vehicle near your home or business
• Noticing people lingering near your home, office or other locations you frequent
• Feeling like you are being followed when driving
• Catching someone photographing or filming you or your property when they have no clear reason to

The IRS may also monitor your digital communications and activities to obtain evidence. Be on the lookout for:

• Unusual activity on your devices like unknown logins or new programs
• Issues with your internet that could indicate monitoring like slower speeds or disconnections
• Spam emails designed to get you to click malicious links that could install spyware
• Fake social media accounts trying to connect with you to gather information

Protecting Yourself from IRS Undercover Operations

If you suspect you may be the target of an IRS undercover operation or surveillance, here are some tips to protect yourself:

• Consult with a tax attorney immediately about your case and options
• Politely decline any requests for interviews by IRS agents until you have representation
• Avoid knowingly transmitting any false information to undercover IRS agents
• Do not destroy or alter any documents that may be relevant to an investigation
• Be cautious in all communications in case you are being monitored
• Keep detailed records of any suspicious activities in case you need evidence

While IRS undercover operations are legal, experienced tax attorneys can ensure the IRS follows proper procedures and does not violate your rights. If charged with tax crimes, you have the right to defend yourself vigorously in court.

Dealing with IRS scrutiny is stressful, but understanding their investigative tactics can help you protect yourself and avoid accidentally making the situation worse. With smart precautions, you can get through an IRS undercover operation or surveillance intact.

References

[1] IRS Internal Revenue Manual on Undercover Operations

[2] IRS Internal Revenue Manual on Surveillance

[3] IRS Internal Revenue Manual on Sources of Information

[4] IRS FY 2022 Enforcement Results

[5] IRS Report on Sentencing in Undercover Operation

[6] IRS Internal Revenue Manual on Investigative Tools