IRS Relaxing Rules on Tax Settlements?
ABC News is reporting that IRS Commissioner Doug Shulman said today that the IRS is “loosening its rules for negotiating tax settlements for less than the amount owed.” This IRS program is known as the Offer in Compromise program.
If you are looking for a looking for a Knoxville Tennessee tax attorney, visit my website for help in negotiating with the IRS. Or give me a call today at 865-566-0125.
IRS Eases Rules on Tax Settlements – ABC News
The Internal Revenue Service is giving agents more flexibility to work with taxpayers who have seen their incomes drop during the recession.
IRS Commissioner Doug Shulman said Tuesday that the agency is loosening its rules for negotiating tax settlements for less than the amount owed. The agency also plans to start opening some local offices on Saturdays, beginning March 27, to give taxpayers more opportunities to resolve their tax debts.
For assistance from a Tennessee tax attorney with an Offer in Compromise, contact Norman D. McKellar at 877-4-TAX-SOS.
Another Civil Settlement Reached in Medicare Fraud Case
As a follow-up to my prior post on Healthcare & Medicare fraud, another medical clinic is resolving its alleged fraudulent activities on the civil side of the law (as opposed to sitting in a jail cell).
Advanced Pain Centers, doctor to pay $820,000 for Medicare fraud – St. Louis Business Journal:
A doctor from Town and Country, Mo., his wife, their pain management clinics and his billing company must pay $820,000 to settle allegations of submitting false claims to Medicare, Medicaid and Tricare.
The United States Attorney’s Office for the Eastern District of Missouri said Tuesday it reached a civil settlement with Abdul Naushad, 46, his wife, Wajiha Naushad, and their pain management clinics doing business as Advanced Pain Centers.
The civil settlement also resolves claims with Naushad’s billing company, Ultimate Practice Solutions, and its owner Azeem Meo, 58, of Carmel, Ind.
Naushad and his wife own and operate six pain management clinics throughout Missouri all doing business under the Advanced Pain Center (APC) name: Advanced Pain Center Cape, Advanced Pain Center Farmington, Advanced Pain Center Twin Cities, Advanced Pain Center St. Louis, Advanced Pain Center Eureka, and Advanced Pain Center Kennett. Meo owns and operates a billing company, Ultimate Practice Solutions, whose main business is to conduct the billing operations for the APCs.
The U.S. attorney alleges that Naushad, his wife, the APCs, Ultimate Practice Solutions and Meo submitted false claims to Medicare, Missouri Medicaid, and Tricare for spinal decompression services performed with a DRX-9000 machine. The claims were false in that they indicated that direct one-on-one physical therapy was performed when, in fact, no one at APC performed physical therapy and APC did not even employ a physical therapist, federal prosecutors said. Physical therapy codes were falsely used to attempt to obtain payment for use of the DRX-9000 machine, which is deemed experimental, and therefore is not covered or reimbursable by Medicare, Missouri Medicaid, or Tricare, according to the U.S. attorney’s office.
The civil settlement dismisses a complaint that was filed by whistleblowers Annetta Schwader and Amanda Richards, both former employees of APC.
For a Knoxville Tennessee Healthcare & Medicare fraud lawyer, visit my website or call 865-566-0125 for a consultation.
From the Ridiculous Lawsuit Department…
http://www.abajournal.com/news/article/lindsay_lohan_files_100m_suit_over_e-trades_milkaholic_baby/
Lindsay Lohan claims in a $100 million lawsuit that the boyfriend-stealing, milkaholic baby featured in an E-Trade ad is modeled after her.
The ad debuted during the Super Bowl, the New York Post reports. It portrays a baby boy apologizing to his girlfriend via an online video chat for failing to call her the night before. The baby girlfriend replies, “And that milkaholic Lindsay wasn’t over?” The girlfriend’s suspicions prove true, as another baby girl at the boy’s home sticks her head in the frame and says, “Milk-a-what?”
Lohan’s lawyer, Stephanie Ovadia, told the Post that her client is so well known that her first name brings instant recognition, the same as Oprah or Madonna. “They’re using her name as a parody of her life,” Ovadia told the Post. “Why didn’t they use the name Susan? This is a subliminal message. Everybody’s talking about it and saying it’s Lindsay Lohan.”
The ad agency contends the name was used because it is popular and happened to be the name of one of its account team members, the story says.
Hat tip to Pat’s Papers.
If you are looking for a Knoxville Tennessee Trial Attorney, contact the lawyers at The McKellar Law Firm, PLLC, today at 865-566-0125.
Former FBI Agent Pleads Guilty to Tax Evasion
A retired FBI agent pleaded guilty Friday to evading about $109,000 in personal income taxes, Nevada’s U.S. Attorney Daniel Bogden said today.
Jan Lindsey, 67, of Henderson pleaded guilty before U.S. District Judge James C. Mahan to one count of felony tax evasion and is scheduled to be sentenced July 9.
According to the plea agreement, Lindsey worked as an FBI agent for 26 years and retired from the agency in 1995. For the next 10 years, Lindsey worked for the FBI as a contractor performing background investigations. Prior to 1999, Lindsey timely filed tax returns with the IRS.
Beginning in 1999, Lindsey started using illegal tax avoidance methods to file his and his wife’s joint tax returns. Lindsey failed to timely file or pay federal income tax for the years 1999 through 2006, and committed various acts that were designed to hide his income and assets from the IRS. He placed assets in nominee names, presented or recorded fraudulent documents in an attempt to obtain lien and levy releases on his property, filed false returns after liabilities were assessed in an attempt to reduce or eliminate his unpaid liability, and presented frivolous financial or negotiable instruments to the Treasury Department in claimed payment of his outstanding tax liability.
Lindsey was arrested in May with three others after a three-year investigation by the Nevada Joint Terrorism Task Force into allegations of money laundering, tax evasion, and possession of unregistered machine guns by members of a “sovereign citizens” anti-government movement.
Co-defendants Samuel Davis, 54, of Council, Idaho, and Shawn Rice, 46, of Seligman, Ariz., are scheduled for trial beginning June 21. Co-defendant Harold Call, 67, of Las Vegas is currently scheduled for trial beginning March 22. But a stipulation to continue the trial date is pending before the court.
According to court records, from March 2008 through the date of the indictment, Davis and Rice allegedly laundered for undercover FBI agents roughly $1.3 million, which they had been told were proceeds of a bank fraud scheme.
For a Tennessee tax and criminal defense lawyer, click here.
There’s a Fine Line Between Criminal and Civil Healthcare Fraud
There’s a fine line that exists between many civil and criminal matters, such as healthcare fraud or Medicare fraud. As the case below discusses, that line is often as simple as whether the alleged wrongdoer was “willful” in his/her actions.
Connecticut Law Tribune: Hospital Settles Claims That It Overcharged Medicare
The U.S. government and Johnson Memorial Hospital in Stafford Springs entered into a civil settlement agreement late last month to resolve allegations that the infirmary violated the False Claims Act.
The U.S. Attorney’s Office in Connecticut alleges that Johnson Memorial Hospital overcharged Medicare for infusion therapy, chemotherapy administration, and blood transfusions between 2000 and 2005.
During this period, Medicare authorized payments for one unit of infusion therapy (in which a drug is administered intravenously) and chemotherapy administration per patient visit. Also, only one unit of blood transfusion service was permitted per day. However, on many occasions, Johnson Memorial Hospital billed Medicare for between two and eight units per patient visit, according to the U.S. Attorney’s Office.
“Billing for inflated charges relating to chemotherapy, infusion, and blood transfusion services siphons critical resources away from the Medicare program, which relies on hospitals to bill Medicare honestly and accurately,” acting U.S. Attorney Nora Dannehy said in a statement. “Health care fraud is a national problem that the United States Attorney’s Office is devoted to combating.”
Johnson Memorial Hospital, which declared bankruptcy in 2008, agreed to settle the civil dispute by reimbursing Medicare $191,193. By settling the case, the hospital does not admit any liability. The hospital will immediately pay $95,596 of the amount and then pay the remainder over a two year period plus interest.
“What happened here is an honest mistake,” Peter J. Betts, the hospital’s interim president and CEO recently told the Hartford Courant. “There are hundreds of billing codes that you use when you bill Medicare, and if you happen to pick the wrong code, you can be overpaid or underpaid. We would not knowingly overbill.”
If you are being accused of willfully violating the law, contact the legal defense team at The McKellar Law Firm, PLLC, today at 865-566-0125 for a free consultation. For a Tennessee Healthcare and Medicare attorney, click here.
Receive a “Free” Goody Bag at the Oscars & Have an Additional $91,000 of Income to Report to the IRS
TaxProf Blog: Oscar Swag Bags to Result in $91k Income to Celebrity Presenters
Tonight’s Oscars have lost a bit of their buzz — not because of the expansion of the Best Picture nominees from five to ten, but because the tax consquences of the swag bags received by the celebrity presenters — worth a record-setting $91,000 this year — are well settled. From IRS and Hollywood Reach Accord on Gift Bags:
The IRS [has] launched an outreach campaign to the entertainment industry regarding the taxability of gift bags and promotional items, following its agreement with the.Academy of Motion Picture Arts & Sciences resolving outstanding tax responsibilities with respect to Academy Awards gift baskets:
* IRS Outreach to Entertainment Industry on Gift Bags (IR-2006-128)
* Gift Bag Questions and Answers
* Academy of Arts and Sciences News ReleaseQ: What are the federal income tax consequences to a person who accepts a gift bag in recognition of involvement in an awards show?
A: In general, the person has received taxable income equal to the fair market value of the bag and its contents and must report that amount on his or her federal income tax return.
Q: What are the federal income tax consequences to a person who makes selections at a free shopping room in recognition of involvement in an awards show?
A: In general, the person has received taxable income equal to the fair market value of the selections that he or she made at the free shopping room, and must report that amount on his or her federal income tax return.
Q: Can the recipient take a charitable contribution deduction if he or she contributes the gift bag to charity?
A: If the gift bag is donated to a qualified charitable organization, the recipient may be able to take a tax deduction for his or her charitable contribution, subject to applicable limitations and requirements. But this does not change the taxability of the value of the items. The fair market value must still be reported on the celebrity recipient’s federal income tax return.
Real Life Tax Structuring
As a follow-up to my prior post about tax structuring, the story below gives a real life example of structuring payments in an effort to evade taxes.
Fed court: Two thumbs down on movie theaters’ tax evasion
A co-owner of movie theaters in Port Orchard and Bremerton pleaded guilty Friday to not paying taxes on incomes from those businesses.
Cindy Ondracek of Port Orchard made that in U.S. District Court in Tacoma.
Ondracek and her husband Jack have owned a three-screen drive-in movie theater in Port Orchard since 1986, and a Bremerton theater, the Redwood Cinema, from 2002- to 20005.
Ondracek admitted in court that the she did not pay income taxes on $197,000 in revenue from those theaters from 2002 to 2005, said a federal Internal Revenue Service news release. About $68,000 in taxes was owed.
Overall, the Ondraceks took in about $2 million in gross receipts in that period, the IRS said.
The Ondraceks failed to file tax returns for those years, the IRS said. Cindy Ondracek made deposits to their bank accounts in sums of less than $10,000, which is the threshold for banks to report deposits to the federal government.
The news release did not elaborate on Jack Ondracek. But it noted that Cindy Ondracek knew about the $10,000 reporting threshold, and was the one who structured the deposits to fall beneath that level.
Cindy Ondracek is scheduled to be sentenced on May 27. She faces up to five years in prison and a $250,000 criminal fine, plus interest and penalties on the tax loss. The Ondraceks also face civil penalties on the cases.
Florida Pain Clinic Raided by FBI & DEA Agents
The Federal Government has been increasing its attention on so-called “pill mills,” and the latest to fill the sting of the Government’s efforts is American Pain in Florida. Agents have raided the offices of American Pain and forfeiture proceedings have begun against the owner of the clinic. Unfortunately for the principals of American Pain, these Government actions are likely only the first of unpleasant moves that they can expect in the near future.
Raided Lake Worth pain clinic handed out 2 million pills in a year – Broward – MiamiHerald.com
The federal government has called American Pain a “pill mill.” But the Lake Worth pain clinic operated more like a factory, churning through 250 patients a day, paying doctors as much as $44,000 a week, and distributing more than two million painkillers in a single year.
Those details are contained in a forfeiture lawsuit the U.S. attorney’s office filed this week seeking to seize three houses from American Pain’s owner, Christopher George. The suit was filed Wednesday, the same day federal agents and local sheriff’s deputies raided American Pain and two other clinics operated by George’s twin brother, Jeffrey.
American Pain is only one of as many as 200 loosely regulated pain clinics now operating in South Florida, making the region the chief supplier of black-market pills for much of the eastern United States. The explosion of clinics — and the coinciding spike in prescription overdose deaths in the state — has prompted lawmakers and law enforcement to begin cracking down on the industry.
In the suit, prosecutors said George has been under investigation on suspicion of drug trafficking and money laundering for 18 months. Investigators said George tried to conceal his role as American Pain’s owner by listing his mother and girlfriend as “straw owners” on corporate records. But George, 29, of Royal Palm Beach, has not been charged with any crimes.
The suit describes American Pain as a massive — and massively lucrative — enterprise, attracting 250 patients a day from Kentucky, Ohio and South Carolina to buy painkillers. Prosecutors described the patients as mules in a drug-running circuit throughout the South: Out-of-state couriers could buy one pill of the painkiller oxycodone at American Pain for $5, and resell the narcotics in their home states for as much as $80 a pill, the suit says.
Investigators tracked 147 cash deposits totaling more than $14 million that flowed through American Pain’s bank accounts in 2009 alone. A George associate told an undercover agent that George was trying to launder as much as $40 million in assets, the suit says.
Neither George nor his lawyer, James Eisenberg, could be reached for comment Thursday. But Eisenberg previously has said that the George brothers broke no laws while running their businesses.
The pain-clinic business was also generous to the five doctors who worked at American Pain: Dr. Cynthia Cadet of Fort Lauderdale; Dr. Jacob Dreszer of Hollywood; Dr. Roni Dreszer of Hollywood; Dr. Michael Aruta of Boca Raton; and Dr. Beau Boshers of Palm Beach Gardens. Combined, they received $5.1 million in payments last year for providing exams and writing prescriptions at the clinic, prosecutors say.
These five doctors ordered more than 2.1 million oxycodone pills in 2009 through American Pain, prosecutors say. All five physicians are among the top 20 doctors who dispensed the most oxycodone in the United States last year, the suit says, citing DEA data.
Prosecutors said they were reviewing allegations that the doctors were paid based on the number of patients they saw. The doctors were not paid employees of the clinic, but were paid as independent contractors, the suit says.
None of the five doctors has ever been disciplined by the state medical board, records show. No doctor would comment for this story.
“There’s an ongoing investigation. I can’t answer those questions,” Boshers told The Miami Herald on Thursday. According to the government’s lawsuit, he ordered 439,599 oxycodone pills in 2009 through American Pain, which paid him $1.2 million.
Tax-Evading Parents Ordered to Jail, Leaving Behind 3 Children
One of the sadder moments in criminal defense work occurs when a parent is ordered to begin a prison sentence while leaving behind a family. Even worse is a tax evasion case out of Ireland, where both parents were ordered to serve multi-year prison sentences while leaving behind 10, 16, & 18-year-old children.
Parents jailed for tax fraud – Tax, Money – Belfasttelegraph.co.uk
Two Northern Ireland parents were jailed on Friday 26 February 2010 for evading tax leaving them owing HM Revenue & Customs over £4 million.
Leaving children aged 10, 16 and 18 this should serve as a warning to anyone fiddling their taxes on a large scale. HMRC means business, and having children at home will not keep you out of jail.
Gerry Small (Patrick Gerard Small) of Cullenrammer Road, Dungannon, aged 56 was jailed for 3.5 years after pleading guilty. The judge said this sentence was substantially reduced “as an act of mercy” in the light of Mr Small’s ill-health. Medical evidence pointed to a list of 10 conditions which Mr Small suffered from. Mr Small had tried to pin the blame for the tax offences on Mrs Small – a tactic which the judge described as “dishonest and unedifying”.
Mary Small – his wife of the same address – aged 50 was jailed for 2.5 years. Her sentence was reduced to reflect her prompt guilty plea and the fact that she did not play games with the legal system once she pleaded guilty. (By way of contrast Gerry Small pleaded not guilty, then guilty, then said he wanted to back to not guilty. Finally he abandoned that tactic and so remained at guilty!) The judge acknowledged the difficulty and distress that jailing a mother of a 10-year-old would have, but felt he had no alternative but to send her to jail as well as her husband.
What Punishment Will I Receive If I Am Found Guilty of a Federal Tax Crime?
The answer to the question posed in the title of this blog varies depending on a variety of factors, one of which is the “Tax Table” contained in Section 2T4.1 of the Federal Sentencing Guidelines. The Guidelines are advisory only, and there are other factors which a sentencing judge must consider.
The Tax Table can be helpful to assist in determining a potential range of punishment that a judge may consider when sentencing a taxpayer convicted of committing a tax crime. The table below shows which “offense level” fits based on the amount of “tax loss,” which in and of itself is a sometimes difficult concept to understand. To analyze where you fit on the Sentencing Guidelines, determine the amount of Tax Loss and find your corresponding Offense Level on the chart below.
Tax Guidelines
§2T4.1. Tax Table
Tax Loss (Apply the Greatest) Offense Level
(A) $2,000 or less 6
(B) More than $2,000 8
(C) More than $5,000 10
(D) More than $12,500 12
(E) More than $30,000 14
(F) More than $80,000 16
(G) More than $200,000 18
(H) More than $400,000 20
(I) More than $1,000,000 22
(J) More than $2,500,000 24
(K) More than $7,000,000 26
(L) More than $20,000,000 28
(M) More than $50,000,000 30
(N) More than $100,000,000 32
(O) More than $200,000,000 34
(P) More than $400,000,000 36.
Once you have determined your Offense Level, review the Sentencing Table below:
U.S. Sentencing Guidelines
The Sentencing Guidelines are only one factor that a sentencing judge will consider before he/she sentences a convicted tax defendant. An experienced criminal defense attorney can be essential in developing your best approach at a sentencing hearing. To contact an attorney today to discuss how your actions may impact your range of punishment, contact Norman D. McKellar today at 877-4-TAX-SOS.