IRS Criminal Investigation in San Diego

IRS Criminal Investigation works San Diego cases out of the downtown federal complex at 880 Front Street, San Diego, CA 92101. IRS-CI special agents are distinct from IRS Revenue Agents (who conduct audits) and Revenue Officers (who handle collections). They are criminal investigators, and their contact should be treated accordingly.

IRS-CI opens investigations based on referrals from IRS Examination, information from financial institutions, whistleblower tips, and intelligence from other federal and state agencies. Once an investigation is opened, the agents conduct financial analysis, gather records through summonses and grand jury subpoenas, and interview witnesses. The target of the investigation may be the last person interviewed — or may never be interviewed at all before an indictment.

Federal criminal tax cases are prosecuted by the U.S. Attorney’s Office for the Southern District of California in the U.S. District Court for the Southern District of California. The Tax Division of the U.S. Department of Justice reviews and approves most criminal tax indictments before they are returned.

When You Need a Criminal Tax Attorney in San Diego

The signs that an IRS matter has crossed into criminal territory are specific. If you encounter any of the following, stop cooperating with the IRS and contact a criminal tax attorney immediately:

  • Unannounced visit by IRS-CI special agents: Special agents identifying themselves as IRS Criminal Investigation agents are not examiners or collection officers. Do not answer any questions. Ask for their business cards, say you will not speak without an attorney present, and end the conversation.
  • Grand jury subpoena: A federal grand jury subpoena requiring you to produce documents or testify means a grand jury is investigating potential criminal activity. Contact a criminal tax attorney before responding to any grand jury subpoena.
  • IRS-CI summons: A formal IRS summons issued by an IRS-CI special agent (as opposed to a Revenue Officer) is a criminal investigative tool. It is different from a collection summons and should be treated differently.
  • Notice that you are the subject or target of a federal investigation: If you are told — by a federal agent, a third party, or through a target letter — that you are the subject or target of a federal investigation, retain criminal defense counsel immediately.
  • Civil audit turning adversarial: An eggshell audit — a civil examination where the examiner appears to be looking for fraud indicators — can convert to a criminal investigation. If an examiner is asking unusual questions about your intent or lifestyle, the audit may be more than civil.

Federal Criminal Tax Prosecutions

Federal criminal tax prosecutions in the San Diego area are brought in the U.S. District Court for the Southern District of California by the U.S. Attorney’s Office for the Southern District of California. The primary federal criminal tax statutes are:

  • 26 U.S.C. § 7201 — Tax Evasion: A felony. The government must prove an affirmative act of evasion (not mere failure to pay), willfulness, and a tax deficiency. Penalties include up to 5 years imprisonment and a $250,000 fine.
  • 26 U.S.C. § 7202 — Failure to Collect or Pay Over Tax: A felony. Applies to employers who withhold payroll taxes from employees but do not remit them to the IRS. This is the criminal employment tax statute.
  • 26 U.S.C. § 7203 — Willful Failure to File: A misdemeanor. Failure to file a return, pay tax, or keep records, when willful. Penalties up to 1 year imprisonment per count.
  • 26 U.S.C. § 7206 — False Returns: A felony. Filing a materially false return under penalty of perjury. Each false entry can be a separate count.

The government must prove willfulness beyond a reasonable doubt for most criminal tax offenses. Willfulness in the criminal tax context means a voluntary, intentional violation of a known legal duty — not merely negligence or mistake. Challenging the government’s evidence of willfulness is often the central issue in criminal tax defense.

See our criminal tax defense practice page and our eggshell audit page for more on how we approach criminal tax matters.

Local Context: How Criminal Tax Defense Actually Works in San Diego

Federal tax matters in San Diego are handled out of the IRS San Diego field office at 880 Front Street, Suite 2226, San Diego, CA 92101. Our office is in Del Mar Heights (12636 High Bluff Drive, Suite 300), about 20 minutes north on the I-5. Most of our IRS field meetings on San Diego cases happen downtown. The downtown federal complex houses the IRS, the U.S. Attorney’s Office for the Southern District of California, and (across the plaza) the Edward J. Schwartz United States Courthouse — where most federal tax matters affecting San Diego residents are litigated when they reach district court.

For practical purposes, that means:

  • IRS field interactions — Revenue Officer territory meetings, Office Audit appointments, and IRS-CI subject interviews typically happen downtown rather than at a satellite office.
  • U.S. District Court for the Southern District of California — refund suits, criminal tax indictments, and § 7402 collection actions are heard at the Schwartz Courthouse at 221 W. Broadway. Tax matters in this district are heard by the active SDCA bench, with criminal tax cases historically drawing the more experienced trial judges.
  • U.S. Bankruptcy Court for the Southern District of California — discharge of older federal tax debts is litigated at 325 W. F Street, three blocks from the IRS office. Bankruptcy and IRS collection often interact more than most clients expect.
  • U.S. Tax Court calendars — the Tax Court does not have a permanent San Diego location, but it sends judges to San Diego two to three times a year for trial sessions. San Diego taxpayers typically litigate Tax Court matters here rather than traveling to Los Angeles or San Francisco.
  • California FTB / CDTFA / EDD — the state agencies have local offices serving San Diego: FTB at 7575 Metropolitan Drive, CDTFA at 15015 Avenue of Science (Rancho Bernardo), and EDD at 4641 Frazee Road. Most California state tax matters originating in San Diego are handled out of these offices.

San Diego itself runs the demographic gamut: defense contracting and biotech in Sorrento Valley, tourism and hospitality on the coast, small business across every neighborhood, and the largest military payroll on the West Coast. IRS collections cases out of San Diego frequently involve military pay, contractor revenue, real-estate-heavy balance sheets, and the kinds of cross-border arrangements that come with being a port city. We handle the full range here because our practice is built around it.