San Diego Tax Fraud Lawyers

Welcome to Spodek Law Group. Our mission is simple: we believe everyone deserves a fighting chance when the government comes after them. If you're reading this, something happened that made you search for tax fraud lawyers in San Diego. Maybe the IRS sent a letter. Maybe federal agents showed up at your business. Maybe your accountant called with news that made your stomach drop. Whatever brought you here, you need to understand something most people don't realize until it's too late.

San Diego faces the worst of both worlds in tax fraud prosecution. Like all California cities, you face dual prosecution - federal AND California Franchise Tax Board with its nation's-highest 13.3% tax rate. But unlike Los Angeles, San Diego sits in a border district. The Southern District of California shares a direct border with Mexico and has spent decades developing sophisticated financial investigation capabilities from cartel money laundering, smuggling operations, and cross-border fraud prosecutions. You get California's aggressive dual prosecution PLUS border district forensic sophistication. It's the worst combination possible: California's hunger for tax revenue AND border district expertise in following money across complex structures.

Most people think tax fraud in San Diego is similar to Los Angeles. Both cities face California's aggressive state prosecution. Both face the FTB. Both deal with federal enforcement. But there's a critical difference that most people miss. Los Angeles is in the Central District of California - a massive district focused primarily on entertainment industry and corporate fraud. San Diego is in the Southern District of California - a border district that developed world-class financial crimes expertise tracking cartel money. The prosecutors here have skills that Los Angeles prosecutors don't have. The techniques they perfected following billions of dollars across international boundaries? They use those same techniques on your unreported income. If you're facing similar issues in other cities, see our guides on Los Angeles tax fraud lawyers, New York City tax fraud lawyers, or Chicago tax fraud lawyers.

The Worst of Both Worlds

Heres the thing most people dont understand about tax fraud in San Diego. You face two separate prosecution threats that combine in devastating ways. The first threat is California itself. The California Franchise Tax Board has a 13.3% top marginal rate - the highest state income tax in America. That creates enormous incentive for California to pursue tax fraud aggressively. Every dollar you evade costs California 13 cents. They want that money back. And theyve built one of the most sophisticated state tax enforcement agencies in the country to get it.

The second threat is the Southern District of California. SDCA isnt like other federal districts. Its a border district that spent decades investigating cartels, smuggling operations, and money laundering networks that span multiple countries. The forensic accounting techniques they developed tracking drug money through offshore accounts and shell companies? Those skills transfer directly to tax fraud investigation. When SDCA prosecutors look at your business, there not confused by complicated structures. Theyve seen structures ten times more sophisticated - and they broke those.

And heres were it gets devastating. These two threats work together. Federal prosecutors at SDCA coordinate with California FTB. They share information. They share witnesses. They share evidence. When one agency finds something, both agencies benefit. Your trying to hide from two sophisticated enforcement systems that talk to each other constantly. Any discrepancy between your federal and state returns becomes evidence of fraud. Any inconsistency triggers both investigations.

The math is brutal. Federal tax evasion: up to 5 years per count. California tax fraud: up to 4 years for felony tax evasion. Sentences can run consecutively. Combined with border district forensic expertise that catches schemes other districts would miss. You face California's aggressive prosecution appetite backed by investigators who learned there craft tracking billions in cartel money. Its the worst possible combination for a tax fraud defendant.

California's 13.3% Tax Rate and the FTB

California's 13.3% top marginal income tax rate isnt just a number. Its a statement of priorities. That rate - the highest in America - means California has more at stake in every tax fraud case then any other state. When you evade taxes in California, your not just cheating the IRS. Your cheating a state that needs that revenue and will fight to get it back. The California Franchise Tax Board has built one of the most aggressive tax enforcement operations in the country.

The FTB dosent just audit. They investigate. They have dedicated criminal investigation units. They coordinate with federal authorities. They pursue residency audits aggressively - tracking down California residents who claim to have moved to lower-tax states while still earning California income. And when they find fraud, they refer cases to the California Attorney General for criminal prosecution. State charges. State trial. State prison. All seperate from whatever the federal government decides to do.

And heres the part that catches people off guard. California dosent let you go easily. If you leave California for a lower-tax state - Nevada, Texas, Arizona - the FTB will audit your departure. They look for any evidence you still have ties to California. Property. Business interests. Family. Time spent in-state. If they conclude your still a California resident despite your claims, you face back taxes, penalties, interest, and potentially criminal charges for filing false returns. California follows former residents for years.

The FTB shares information with the IRS through coordinated enforcement programs. When they audit your California return, that information goes to federal authorities. When the IRS audits your federal return, California learns about it. These agencies work together. The fiction that you can hide from one while satisfying the other is exactly that - fiction. In San Diego, your facing two coordinated adversaries, not two seperate problems.

Southern District of California: Border Expertise

Most people only think about the IRS when they think about tax fraud prosecution. Thats a mistake that destroys lives. The Southern District of California didnt become expert in financial crimes by investigating tax cases. They became expert tracking cartel money. Following drug proceeds through shell companies. Unraveling smuggling networks that moved billions across international borders. The skills they developed on those cases are the same skills they now apply to domestic tax fraud.

Think about what that means for your case. SDCA prosecutors have spent decades following money through offshore accounts. They understand complex corporate structures designed to hide ownership. They know how to break down financial schemes that span multiple jurisdictions. They know how to turn witnesses who thought they were protected. The prosecutors who took down international money laundering operations are the same prosecutors reviewing your tax returns.

The FBI San Diego field office has a dedicated white-collar crimes squad that works hand-in-hand with IRS Criminal Investigation. These agencies coordinate seamlessly. They share intelligence. They build cases together. When you become a target in San Diego, your not facing a single agency. Your facing a multi-agency task force with border-refined expertise and unlimited patience. They can investigate for years before you ever know theres a problem.

And heres the part most people miss. Border district prosecutors see patterns that other districts dont. They know how money moves across boundaries. They understand the techniques criminals use to hide assets. When those same techniques appear in a domestic tax fraud case - offshore accounts, foreign corporations, complex trust structures - SDCA prosecutors recognize them immediatly. Your clever scheme isnt clever to them. Theyve seen it before. They know how to break it.

When Your Civil Audit Becomes Criminal

An IRS audit seems like a tax problem, not a criminal one. Your dealing with a Revenue Agent, answering questions, providing documents, trying to resolve the issue. Its stressful but it feels managable. Your cooperating. Your being helpful. Your doing everything there asking. But heres what nobody tells you - that auditor is trained to spot criminal indicators. And when they find them, they refer you to Criminal Investigation without telling you.

Let that sink in. The person your cooperating with, the person your trying to help, the person your providing documents to - that person can send your file to criminal investigators and never tell you it happened. The referral happens through Form 2797. Your never notified when this form is filed. There no letter, no phone call, no warning. The civil audit continues like nothing changed, but in the background, a Special Agent has been assigned to your case and evidence gathering begins.

Everything you said during your "civil" audit - every explaination you gave trying to be helpful - is now being compiled into a criminal case against you. Your cooperation is building the prosecutions file:

• The helpful documents you provided? Evidence.
• The detailed explainations you gave? Admissions.
• The questions you answered honestly? Self-incrimination.

You were building the case against yourself and you didnt even know it.

Heres the part that makes defense lawyers cringe. You might think your accountant protects you. Theres no accountant-client privilege for tax matters. None. Your accountant can be compelled to testify against you. Your CPA can be subpeonaed. Your bookkeeper can be put on the witness stand. Everyone you talked to about your taxes becomes a potential witness for the prosecution. The person you hired to help you can become the governments star witness against you.

And in San Diego, this audit-to-criminal pipeline exists at both federal AND state levels. An IRS audit can trigger federal prosecution. A California FTB audit can trigger state prosecution. Both agencies share information. What you tell one becomes evidence for both. Inconsistencies between your federal and California returns become proof of intentional fraud. Two agencies. Two sets of investigators. Two potential prosecutions.

Federal Tax Fraud Penalties in California

Federal tax evasion under 26 USC 7201 carries up to 5 years in prison per count. Thats the starting point. But California tax fraud penalties stack on top of federal penalties, not instead of them. California tax evasion can result in up to 4 years in state prison. Fines up to $50,000 for individuals. And these penalties are on top of whatever the federal government imposes.

OK so heres were the math gets scary. Federal conviction: 5 years per count. California conviction: up to 4 more years. Sentences can run consecutively. You serve one, then you serve the other. Add multiple counts on each side, and your looking at combined exposure that can exceed a decade. And federal sentences are served at 85% minimum - no early release for good behavior. When the federal government says five years, they mean at least four years and three months.

Fines for federal tax evasion can reach $100,000 for individuals and $500,000 for corporations. California adds its own fines. Plus restitution to both jurisdictions - every dollar you allegedly evaded from federal AND state, with interest and penalties. The financial destruction can be total. Liens on your home. Seizure of bank accounts. Garnishment of future income. Even if you somehow avoid prison, the financial consequences can follow you for the rest of your life.

And dont think bankruptcy will save you. Tax debts are extremly difficult to discharge in bankruptcy. Both federal and California collection rights survive Chapter 7, survive Chapter 13, survive virtually everything. Once you owe the IRS and California, you owe them basicly forever. The only way out is to pay - or to fight the charges before conviction happens.

Signs Your Already a Criminal Target in San Diego

When federal agents contact you, the type of agent matters more then anything else. IRS Revenue Agent means civil audit - you still have time to prepare, options are still open, your not necesarily in criminal jeopardy. IRS Special Agent means criminal investigation - they've already decided your a target. If a Special Agent shows up at your door, the investigation has been running for months or years before you ever knew about it.

How do you know which type your dealing with? Special Agents carry badges and guns. Revenue Agents dont. Special Agents will introduce themselves as being from IRS Criminal Investigation. There not there to audit your return. There not there to help you resolve a tax problem. There there to gather evidence for a criminal prosecution. And by the time they show up, theyve already reviewed your returns, analyzed your bank records, interviewed witnesses, and concluded that you probably commited a crime.

Heres the thing about Special Agents in San Diego. They have access to the same sophisticated financial investigation tools that SDCA developed for border crimes. They understand complex transactions. They know how to follow money across corporate structures and international boundaries. If your in San Diego and an IRS-CI agent shows up, there bringing capabilities refined on billion-dollar investigations. Your cash business dosent confuse them. Your offshore account dosent impress them. Theyve seen it all before.

Your instinct will be to explain yourself. Clear things up. Show them your not a criminal. Answer there questions. Provide more documents. Cooperate fully. This is exactly what they want, and it destroys your defense. Anything you say without a lawyer present becomes evidence. Every word. Every document. Every helpful explaination. And investigators are trained to ask questions that elicit incriminating responses. They know what there doing. You dont.

The correct response is to politely decline to answer and call a tax fraud attorney immediatly. Not tomorrow. Not after you "get your documents together." Not after you talk to your accountant. Immediatly. Every minute you spend talking to a Special Agent without counsel is a minute your making your situation worse.

What Happens in the First 48 Hours

The moment you learn of a criminal tax investigation, a clock starts. You have 48 hours before critical options start closing. Agents are trained to extract statements fast - before you have time to think, before you can talk to a lawyer, before you understand whats happening. Every word you say without counsel is a mistake that cant be undone.

Heres what there doing while your panicking:

• Interviewing your employees
• Talking to your vendors
• Questioning family members
• Seizing documents
• Freezing bank accounts
• Issuing subpoenas
• Building there case

Your business is being dismantled while you try to figure out whats happening. By the time most people understand the severity, the damage is already done.

And heres the part most people dont think about. Your family members can be brought in for questioning. Your spouse can be subpeonaed. Your adult children can be interviewed. Anyone who might know anything about your finances can be compelled to talk. And what they say becomes evidence. Not just against you - potentialy against them too. Tax fraud investigations have a way of expanding to include everyone in orbit.

The only correct action in the first 48 hours: say nothing, sign nothing, call a tax fraud lawyer. Not a general attorney who dabbles in tax issues. Not your cousin who passed the bar. Someone who handles federal tax crimes exclusivly. Someone who understands IRS-CI, the Southern District, and California prosecution. Someone whos been in the trenches. This is the one window were intervention can change everything.

Real San Diego Tax Fraud Cases That Destroyed Lives

Think your to small to prosecute? San Diego-area tax preparers get prosecuted regularly. Neighborhood shops that help working-class families file there returns. Nothing glamorous. Nothing high-profile. But the Southern District dosent care about glamour. They care about proveable fraud and guaranteed convictions. The size of your operation dosent protect you. The only thing prosecutors care about is wheather they can prove the case.

Maybe you think your offshore structure protects you. It dosent. SDCA has prosecuted defendants with accounts in Switzerland, Panama, Cayman Islands. The border expertise that taught them to follow cartel money? Works just as well on your hidden accounts. International structures dont confuse prosecutors who spent decades investigating international criminal organizations.

Heres what all these cases have in common. Everyone thought they were to smart or to small to prosecute. "They wont come after me." "I'm not a big enough fish." "My situation is different." "They cant trace it." IRS-CI has a 90% conviction rate for a reason - they only bring cases there certain to win. If your reading this because agents contacted you, your already on there radar. The question isnt wheather your going to be investigated. The question is what you do about it.

Why You Need a San Diego Tax Fraud Lawyer NOW

Your reading this because something happened. An agent visit. A letter. A subpoena. A phone call from your accountant that made your stomach drop. Right now, today, you have options you wont have next week. Pre-indictment intervention can sometimes prevent charges. Voluntary disclosure programs may still be available. Cooperation agreements can be structured. Plea negotiations can begin early. But that window closes fast.

Heres were the timing matters. Before indictment, your a "target" or a "subject" - categories that have some room for manuver. After indictment, your a defendant. The charging decision has been made. The grand jury has returned a true bill. Your facing trial. Everything changes. The leverage shifts. The options narrow. The cost skyrockets.

At Spodek Law Group, we handle federal tax fraud cases. Todd Spodek has defended clients against IRS-CI, Southern District prosecutors, and California state prosecution. We understand the unique double threat your facing in San Diego - where California's aggressive enforcement combines with border district forensic expertise to create the worst possible prosecution environment. We've seen what happens when people wait. We've seen clients who talked to agents without counsel and destroyed there own cases. We've seen business owners who thought they could handle it themselves and ended up in federal prison.

The consultation is free. The cost of waiting isnt. Call 212-300-5196. The prosecutors arnt waiting for you to get organized. There building there case right now, today, while your reading this article. There interviewing witnesses. There reviewing documents. There preparing charges. The question is wheather you'll have representation when they make there move - or wheather you'll be one more conviction in there 90% rate.

We've been doing this for years. We know how IRS-CI builds cases. We know how Southern District prosecutors think. We know how California pursues tax fraud charges. We know the judges, the courtrooms, the procedures. And we know what happens to people who try to navigate this system without experienced counsel. Some of them are in federal prison right now, serving sentences that could have been avoided or reduced if they had called a lawyer earlier.

The choice is yours. But the window is closing. Every day you wait is a day the government spends building there case against you. Make the call. Protect yourself. Protect your family. Protect your future. Because once the indictment comes down, protecting becomes much, much harder.

Related Resources

• Los Angeles Tax Fraud Lawyers
• New York City Tax Fraud Lawyers
• Chicago Tax Fraud Lawyers
• Houston Tax Fraud Lawyers
• Phoenix Tax Fraud Lawyers
• Philadelphia Tax Fraud Lawyers
• San Antonio Tax Fraud Lawyers
• Federal Tax Evasion Defense