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An Overview of the Presentence Investigation Report Process for a Criminal Tax Case Prosecuted in the U.S. District Court of Northern California

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A Presentence Investigation Report (“PSR”) is a document that judges use to help assess a defendant’s penalty for a crime. If a criminal defendant is found guilty or pleads guilty to a federal crime, the court will order the defendant to go through the PSR process. Although this article focuses on federal tax crimes such as tax evasion or the filing of false tax returns, the content of this article can apply to other federal offenses.

The PSR process is governed by Rule 32 of the U.S. Rules of Criminal Procedure. A PSR details the defendant’s background and criminal conduct and is based, in part, on an interview with a defendant. Because the PSR can help courts find the most appropriate sentence and mitigate the severity of a sentence, it is one of the most important processes in a federal criminal tax case.

A PSR is not only used by the court to determine the sentence, in the event a defendant is sentenced to prison, a PSR is used to determine a classification score by the Bureau of Prisons. The Bureau of Prisons classifies prisons primarily by one of five security levels: 1) minimum security; 2) low security; 3) medium security; 4) high security; and 5) administrative security. A PSR will also be utilized by the Bureau of Prisons to determine if a defendant qualifies to enter into various programs.

Once a defendant is found guilty of a federal crime or pleads guilty to a federal crime, the court will order the defendant’s counsel to contact the United States Department of Probation Office. After the defendant’s counsel contacts the U.S. Department of Probation, a U.S. Probation Officer will schedule a meeting to interview the defendant. The defendant should understand that the Probation Officer who conducts the interview will become the most important person in his or her life. This is because federal district court judges listen to the recommendations stated in the PSR of the Probation Officer in regards to sentencing. Thus, the defendant should carefully prepare for the interview. In answering the interview questions, the defendant should not only answer each question honestly, but also convey the following to the Probation Officer:

1. The defendant has accepted responsibility for his or her actions. Acceptance of responsibility means that the defendant understands that they committed a tax crime and he or she intends to satisfy any outstanding tax liability, penalties, interest, and restitution. Acceptance of responsibility also means that the defendant will cooperate with Internal Revenue Service (“IRS”) investigators to determine the correct tax liability that is owed to the government;

2. What happened in the defendant’s life to cause the defendant to violate the tax law. Sometimes a defendant did not have a proper upbringing or suffers from diminished capacity. The defendant should be prepared to identify the possible cause as to why he or she committed the offense.

3. What will the defendant do in the future to avoid violating the law. The Probation Officer will likely want to make sure that the defendant does not reenter the criminal justice system in the future. Thus, the defendant should convey a plan to the Probation Officer to make sure he or she will not have issues with the IRS in the future. This could include the hiring of a reputable tax accountant to make sure future tax returns are filed correctly.

4. The community service the defendant has provided to the community. Probation Officers typically like to hear about the community services that a defendant has performed in the past. It is very important for a defendant to discuss any community services that he or she has provided to the community.

5. The defendant will need to convey to the Probation Officer the consequences he or she has already suffered as a result of committing the offense. This could include the loss of a professional license or the loss of a job.

The type of questions that the Probation Officer will ask the defendant depends on the district. If the defendant is scheduled to be sentenced by the U.S. District Court for the Northern District of California, the Probation Officer will ask the following questions about the defendant’s biographical information and education such as:

1. Date of birth.

2. Place of birth.

3. Immigration status.

4. Family members who raised the defendant and if the defendant’s basic material needs were met.

5. What activities was the defendant involved in as a youth such as sports and social groups.

6. Describe any history of domestic abuse in the defendant’s upbringing.

7. Describe any history of domestic abuse in the defendant’s upbringing and if any members of the defendant’s household experienced such abuse.

8. Describe any significant traumatic events the defendant suffered in his or her childhood and how the defendant coped with those events.

9. Number of dependents.

10. Highest level of education.

The Probation Officer will ask about the defendant’s marital and family status:

1. For example, the Probation Officer will ask the defendant to name of current and previous spouses or domestic partners.

2. The Probation Officer will also ask the defendant to name the date and place of marriage.

3. Number of children and current relationship with his or her children.

4. State if the defendant’s children or family members have health problems, criminal history, and substance abuse issues.

5. If applicable, the reason previous relations ended.

6. The defendant must describe his or her relationship with his or her current partner such as who the defendant met his or her current spouse and if there were any incidents of domestic abuse.

7. The defendant must state how the offense affected his or her current marriage.

8. The defendant must describe the employment of his or her current partner.

9. The defendant is asked to note any criminal history, substance abuse, or mental illness of his or her current partner.

10. The defendant must state what plans he or she has made in the event of incarceration.

11. The defendant must provide the names, residence, and occupation of his or her parents.

The Probation Officer will ask the following questions regarding the residential history of the defendant:

1. The Probation Officer will ask the defendant to provide a chronological history of countries, cities and states where the defendant lived and the approximate years(s) during which the defendant lived there.

2. The Probation Officer will also ask the defendant to state how long he or she has lived at his or her current address.

3. The defendant will need to identify other people (name and DOB) that reside at this address and their relationship to the defendant.

4. State if any of these residents have been convicted of a crime, list the nature of the convictions.

5. State what community or charitable organizations the defendant is currently involved with.

6. State how the defendant spends his or her leisure time.

7. State the significant friendships the defendant had growing up and if the defendant maintains any of those friendships today.

8. State if the defendant’s family is aware of the instant offense and if they are supportive of the defendant. The defendant will be expected to give examples In what ways are they supportive and how often does the defendant communicate with his or her family about the instant offense.

9. Indicate whether family members have significant health problems, criminal history, substance abuse, or other problems.

The Probation Officer will ask the following questions about the defendant’s criminal history:

1. Report any juvenile or adult convictions, arrests, pending cases, current state or federal supervision.

2. The defendant will be asked to describe his or her prior experience under probation if applicable.

The Probation Officer will ask the following questions about the defendant’s physical health:

1. The defendant should identify all serious or chronic illness and/or medical conditions, hospitalizations or surgeries.

2. The defendant should tell the Probation Officer all current prescriptions or medications and allergies to food or medication.

3. The defendant should state the name, address, and telephone number of his or her physician.

The Probation Officer will ask the following questions about any substance abuse problems the defendant may have:

1. What is the defendant’s drug of choice?

2. Has the defendant attended outpatient or residential substance abuse treatment.

3. Did the use of drugs or alcohol contribute to the defendant’s commission of the offense.

4. Has the defendant’s use of drugs or alcohol impact his or her relationship with family members, friends, and coworkers.

5. Is the defendant interested in receiving substance abuse treatment.

If applicable, the Probation Officer will ask about the defendant’s military service including:

1. The branch of service.

2. Service number.

3. Rank.

4. Description of combat service and any special training acquired.

5. Description of any Court-Martial or non-judicial punishments.

The Probation Officer will ask the defendant the following questions about his or her employment:

1. What is the defendant’s usual occupation.

2. At the time of the offense, was the defendant employed and for how many months.

3. The defendant will need to describe his or her employment history for the last ten years, including periods of unemployment.

4. The defendant will need to summarize any employment beyond 10 years.

5. If the defendant had periods of unemployment, the defendant will need to explain how he or she supported themselves during periods of unemployment.

The probation officer will ask the defendant regarding his or her future plans or goals:

1. The defendant will need to describe his or her future plans regarding family, employment, treatment, education, and peers.

2. The defendant will need to discuss steps he or she has taken to achieve these goals.

3. The defendant will need to discuss the obstacles he or she faces achieving these goals.

4. The defendant will need to discuss where he or she sees themselves in five and ten years in the future.

5. The defendant will need to tell the probation officer if he or she is released on supervision, what can the probation office do to help the defendant succeed.

The probation officer will ask about the defendant’s mental and emotional health:

1. The defendant will need to discuss any past or present mental or emotional issues, including suicidal thoughts and attempts.

2. The defendant must discuss any past and present gambling addiction problems.

3. The defendant should provide the dates of his or her participation in counseling or treatment.

4. The defendant will need to state if he or she would be willing to participate in counseling if made available.

The probation officer will ask the following questions regarding a defendant’s education, vocational, and other skills:

1. The defendant will need to list all degrees, diplomas, and certificates received.

2. The defendant will be asked if he or she speaks, reads, or writes in another language.

3. The defendant will be asked if he or she repeated any grades.

4. The defendant will be asked if he or she attended any special needs classes.

5. The defendant will be asked if he or she liked and disliked about school.

6. The defendant will be asked to describe any martial arts, firearms or weapons training.

7. The defendant will be asked to describe any other specialized training or skills.

8. The defendant will be asked to identify his or her professional license(s) held.

The Probation Officer will request that the defendant answer the following questions regarding the acceptance of responsibility:

1. The defendant will be asked to accept responsibility for committing the offense and if so to summarize the offense.

2. The defendant will be asked to state how he or she feels about committing the offense.

3. The defendant will be asked what impact his or her behavior had on others.

4. The defendant will be asked what influenced the defendant to commit this offense.

5. The defendant will be asked what his or her plan is to make restitution.

In many cases, with assistance of defense counsel, defendants can answer the aforementioned questions prior to the interview and submit the answers to the Probation Officer.

The Probation Officer will also require the defendant to prepare and file with the probation officer an affidavit fully describing his or her financial resources, including a complete listing of all assets. The Probation Officer may also request that the defendant provide the following:

1. Copies of tax returns filed by the defendant for the last five years.

2. Copies of school diplomas and school transcripts.

3. Copies of marriage certificate.

4. Copies of divorce degrees.

5. Copies of medical records.

6. Copies of naturalization papers (if applicable).

7. Copy of Military discharge certificate (if applicable).

The Probation Officer will then follow-up on all the information collected. If the U.S. probation Officer believes that the defendant was misleading during the interview, or failed to accept responsibility, the probation officer may recommend that the defendant not be given credit for acceptance of responsibility or receive an upward departure from the sentencing guidelines.

Any material a defendant’s counsel would like the Probation Officer to consider for the PSR must be submitted to the Probation Officer at least 45 days prior to sentencing. While note required, defendant’s counsel may want to submit the following to the Probation Officer:

1. A Personal Narrative or Autobiography of the defendant.

2. Character Reference Letters.

The Probation Officer is required to provide a proposed PSR to both the defendant’s counsel and the prosecution at least 35 days before sentencing. See Crim. L.R. 32.4(a). 14 days after the proposed PSR is furnished, defense counsel is required to draft a written response to the Probation Officer’s proposed PSR. See Crim. L.R. 32-4(b). If defense counsel has no objections to the factual statements or guideline computations, defense counsel shall notify the Probation Officer in writing that he or she has no objections. If defense counsel has objections, defense counsel must attend a meeting called by the Probation Officer. See Crim. L.R. 32.4(c)(1). At least 14 days before sentencing, the final PSR, including an addendum and recommendation is required to be disclosed to all parties and the Court. See Crim. L.R. 32.5.

Anthony Diosdi is one of several tax attorneys at Diosdi & Liu, LLP. Anthony Diosdi has represented clients accused of tax crimes both pre and post-indictment. Anthony Diosdi is admitted to the California and Florida bars.

Diosdi Ching & Liu, LLP has offices in San Francisco, California, Pleasanton, California and Fort Lauderdale, Florida. Anthony Diosdi advises throughout the United States. Anthony Diosdi may be reached at (415) 318-3990 or by email: adiosdi@sftaxcounsel.com.

This article is not legal or tax advice. If you are in need of legal or tax advice, you should immediately consult a licensed attorney.

Anthony Diosdi

Written By Anthony Diosdi

Partner

Anthony Diosdi focuses his practice on international inbound and outbound tax planning for high net worth individuals, multinational companies, and a number of Fortune 500 companies.

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