The IRS criminal and civil enforcement organizations work with the Department of Justice, Tax Division to shut down these abusive schemes as quickly as possible in an effort to protect taxpayers from potential additional financial harm. Parallel civil and criminal investigations are an effective and aggressive IRS approach that halts these schemes quickly and permanently. A civil injunction against the promoter stops the scheme and prevents additional ‘clients’ from investing. In addition, CI shares abusive tax scheme investor lists with the civil operating divisions to ensure investor tax returns are considered for examination (audit).
The IRS civil enforcement divisions have developed tools to educate the public about abusive tax avoidance transactions and have issued several consumer alerts.