Posts Tagged ‘Tax Fraud’

The Press Association: 87% lured by tax dodgers’ discount

Most consumers would happily pay in cash for a discount even if told it was for tax evasion, according to a poll.

The survey for MoneySavingExpert.com found 87% of people would knowingly support criminal tax evasion in return for a discount.

Of that group, 22% said they would haggle for an even bigger discount.

The poll asked: “What would you do if a builder/masseuse/cleaner/plumber/market stall holder or anyone else offered you a 15% discount because ‘It’s better in my pocket than in the taxman’s.’?”

Of the 11,285 who responded, 65% said they would take the discount, 22% would haggle and ask for a bigger discount, 10% would refuse it and 3% would report it as tax fraud.

If you are facing criminal tax charges, contact Tennessee tax and criminal defense attorney Norman D. McKellar at 865-566-0125.

Durham woman sentenced for tax evasion :: WRAL.com

Greensboro, N.C. — A Durham woman received a six-month prison sentence Wednesday after pleading guilty to not paying federal taxes on nearly $600,000.

Cheryl Meliones was also fined $4,000 and will be placed on probation for 18 months following her imprisonment. She was sentenced in federal court in Greensboro.

An investigation by the Internal Revenue Service’s Criminal Investigation Division lead to charges against Meliones in October that she didn’t file a federal income tax return in 2004, 2005 and 2006. She pleaded guilty to failing to file a return for $596,100 in 2006.

If you are facing federal criminal tax evasion charges, contact attorney Norman D. McKellar today at 865-566-0125 for a FREE consultation.

U.S. Department of Justice – United States Attorney’s Office, TNWD

Jackson, TN – Isaac H. Brooks, Jr. of Jackson, Tennessee, has been indicted by a grand jury, charged with 29 counts of income tax evasion announced Lawrence J. Laurenzi, United States Attorney for the Western District of Tennessee. Brooks had his initial appearance before U.S. Magistrate Edward G. Bryant today, and he was detained pending his detention hearing set for 1:00 pm on Friday, April 30th, 2010.

According to the indictment, Brooks filed Individual Form 1040 tax returns for 2002 and 2003 that substantially understated his taxable income and tax due and owing to the United States. The indictment alleges that Brooks then failed to file individual income tax returns for 2004 through 2007 with the Internal Revenue Service (IRS) as required by law. During this time Brooks allegedly leased or purchased several new vehicles including two Cadillac Escalades, an Infiniti G35 Coupe, a Mercedes Benz CLS500C, a BMW 745LI, and purchased household furnishings, all in the nominee name of Antioch Missionary Baptist Church. Brooks also concealed his involvement and/or ownership of his business, Temp Owned Temporary Service (TOTS) by having the City of Jackson’s Business Tax Report in his wife’s name. Additionally, the indictment alleges that Brooks provided false and misleading information to an Internal Revenue Service Officer.

The indictment also states that for two quarters in 2003 and for all of 2004 and 2005, Brooks filed false and fraudulent quarterly Form 941, Employer’s Quarterly Federal Tax Return for his business, TOTS. For each of these quarters, Brooks substantially understated the taxable wages paid to employees, federal income tax withholdings, and social security taxes due and owing for each quarter. For all of 2006 and 2007, Brooks failed to file these quarterly employer returns with the IRS as required by law.

Lastly, the indictment alleges that Brooks filed fraudulent Form 940-EZs, Employer’s Annual Federal Unemployment (FUTA) tax returns for TOTS for calendar years 2003 and 2004. The indictment states that Brooks substantially understated the total wages paid to employees for those years, thus understating the FUTA tax due and owing to the United States. Brooks failed to file Forms 940-EZs for 2005 through 2007 with the IRS.

Brooks faces a maximum penalty of 5 years and a fine of $250,000 on each count if convicted.

If you are facing a tax evasion charge, contact criminal defense tax attorney Norman D. McKellar today at 877-4-TAX-SOS for a FREE consultation.

Houma man faces tax evasion charge | DailyComet.com

HOUMA — A Houma man faces a tax evasion charge for reporting he made only $5 in taxable income in 2004 when he actually made hundreds of thousands more, U.S. Attorney Jim Letten’s office said Thursday.

Reginald Caillouet Jr., 61, tried to avoid paying about $43,500 in income taxes by falsifying his 2004 return, according to a news release from Letten’s office. He allegedly made about $117,900 in taxable income that year.

If convicted, Caillouet could receive a maximum of five years in prison, a $100,000 fine and two years of supervised release.

Ladson woman indicted on charges of using fake IRS forms – CHARLESTON, SC NEWS – LIVE 5 WCSC Breaking News, Weather, Sports

COLUMBIA, SC (WCSC) – A Ladson woman was indicted in federal court Wednesday on charges of using a false IRS document.

According to U.S. Attorney William Nettles, Jenene Gourdine, 38, knowingly used a fabicated IRS form that falsely stated that the IRS had released its tax lien on property owned by her spouse when, in fact, the IRS had not released the tax lien.

She used the form in June, 2006.

The maximum penalty that Gourdine could receive is a fine of $250,000 and imprisonment for five years.

College Park man gets 2-year sentence for tax evasion  | ajc.com

A College Park man was sentenced to serve two-plus years in federal prison Monday after his conviction on income tax evasion.

Robert L. Braddy, Jr. 39, hid over $1 million in income, according to a statement issued by U.S. District Attorney in Atlanta Sally Quillian Yates.

Braddy was taken from court straight to prison and will get no chance of parole, according to IRS agent-in-charge Reginael McDaniel.

U.S. District Judge William S. Duffey Jr. sentenced Braddy to two years and six months in prison, followed by three years of supervised release. Braddy also was ordered to pay $306,906 in restitution, according to the U.S. Attorney’s Office

Braddy pleaded guilty on Feb. 24 to under-reporting his income on tax returns from 2003 to 2005, the U.S. Attorney’s Office said.

Sentence in million-dollar tax evasion case: 18 months | StarTribune.com

Saying “My lawyer told me to do it” apparently can be an effective way to avoid a longer prison sentence.

Steven Mark Renner, convicted in December of four counts of tax evasion, was sentenced Wednesday to 18 months in prison — a significantly shorter term than called for by federal sentencing guidelines. Those guidelines call for a sentence of 41 to 51 months.

In explaining his rationale, U.S. District Judge Donovan Frank repeatedly mentioned a letter he had received from Renner’s tax attorney, stating that he stood by his advice to Renner.

Frank did not say he agreed with the attorney’s advice. But he gave weight to the fact that Renner, an Internet entrepreneur and former local guitarist who never graduated from high school, followed it.

Renner was indicted in September 2008 for failing to pay more than $300,000 in income taxes between 2002 and 2005. It later was calculated that Renner evaded more than $1.1 million in taxes.

The Federal Tax Crimes Blog has a good post about how tax fraud and bankruptcy intertwined in a recent case involving a California couple attempting to discharge their tax debts through bankruptcy.

Federal Tax Crimes: Collateral Consequences of Tax Fraud – Bankruptcy Discharge Denied

Collateral Consequences of Tax Fraud – Bankruptcy Discharge Denied
Section 523(a)(1)(C) provides the taxes are not discharged “with respect to which the debtor made a fraudulent return or willfully attempted in any manner to evade or defeat such tax.” In Hawkins v. Franchise Board (Bankr Ct. ND CA No. 07-31394/23/10), the IRS and the California Franchise Tax Board sought to deny the debtors, husband and wife, bankruptcy discharge of their tax liabilities because (i) they had filed fraudulent returns and (ii) they had attempted to evade collection of tax “by dissipating his assets on unnecessary and unreasonable expenditures while he knew he owed taxes and knew he was insolvent.”

The husband was well-educated and earned a lot of money working in Silicon Valley (Apple and Electronic Arts). He sold a large amount of stock and perceived a need to shelter the gain. He fell in with KPMG who hawked him FLIP and OPIS shelters (two of the shelters involved in the big KPMG criminal case in NYC). He then fell on hard times but continued to live a high lifestyle, even while knowing that he owed the IRS the tax. The Court noted that he continued the high lifestyle even after they were insolvent. After the IRS assessed some $21 million, he submitted an offer in compromise to pay about 38%. He paid some of the tax but still had unpaid tax. He and his wife filed Chapter 11 bankruptcy to deal with the tax liability. The Debtors then asked the bankruptcy court to confirm the discharge of the liability (i.e., the nonapplicability of the Section 523(a)(C) exception).

The IRS argued that the couple’s returns claiming the FLIP and OPIS tax benefits were fraudulent at least as to the husband and that the their extravagant lifestyle as their finances cratered was an attempt to evade or defeat the tax…

The court held the husband had attempted to evade or defeat through his extravagant living after the tax debt accrued. The court recognized that some level of expenditures are required without constituting an attempt to evade or defeat, but the sheer extravagance in tough times (relatively) for the husband when a very large tax debt was due tipped the scale.

IRS strikes back in 23-count indictment for Huntertown man | The News-Sentinel – Fort Wayne IN

A Huntertown man who federal authorities say earned more than $1.7 million in assets but did not report the earnings on income tax filings has been charged in a 23-count indictment by a federal grand jury seated in South Bend.

James A. Simon, 59, faces charges of filing false federal income tax returns, failure to file reports of foreign bank and financial accounts, fraud involving private financial aid, and fraud involving federal financial aid, all for an alleged scheme that ran 2003-2006.

Through involvement with five separate businesses – foreign and domestic – Simon is alleged to have not reported funds obtained as earned income, but instead claimed monies as nontaxable loans and advances.

Simon spent all but about $50,000, the indictment alleges.

His claim doesn’t fit with the general definition of loans or advances, however, as authorities found no promissory notes, security enlisting, repayment or repayment schedules, maturity dates or interest tallies, the indictment said. Simon also did not claim any of the five businesses he was involved with, and apparently indebted to, in a 2006 bankruptcy filing. Authorities say he could not have covered the $1.7 million debt even if it were loaned to him, the indictment said.

Authorities – and the South Bend grand jury – also took issue with Simon failing to report on his 2003-2006 federal tax returns that he had bank accounts in Gibraltar, Germany and Cyprus (Gibraltar and Cyprus are the nations in which three of the five businesses Simon was involved in are located).

Simon reportedly had more than $10,000 in funds stored in those banks, and no filing of a required Report of Foreign Bank and Financial Accounts was ever made with the Treasury Department, the indictment said.

It’s tax day — so let’s have a look at some of the biggest evaders in the sports world – ESPN

1. Tax Dodgers (tie)
A. Steve Garvey: Before Tiger there was Steve Garvey. Prior to their extramarital affairs’ going public, both athletes had squeaky-clean images; in fact, Garvey was known as “Mr. Clean.” Now Garvey’s business affairs are as sullied as his personal ones; he owes $490,000 in back taxes.

B. Frank and Jamie McCourt: By carrying forward real estate losses from previous years, the McCourts were able to legally dodge paying state and federal taxes on over $100 million. How this and their bitter divorce plays out in the court of public opinion remains to be seen.

C. Chris Cohan: Speaking of California-based owners, Warriors honcho Chris Cohan is not so golden as he is fighting an IRS tax bill of $160 million. No wonder rumors have Oracle owner and America’s Cup winner Larry Ellison bailing out the franchise.

2. Jose Canseco
Mr. 40/40 should have been more worried about his 1040. We have seen the result of Jose’s home runs (foreclosures, rather) firsthand so it wasn’t that much of a stretch to learn that the slugger had also gone deep in debt with the government. Canseco, who never hit more than .307 during his career, was just hit with a 320 (thousand) dollar tax lien.

Jose seems to be learning from his mistakes (or is he?) as he recently warned his Twitter followers to “Be careful with the irs they r coming down hard on people” only the next day to pimp himself out to fans for $1,000 with a “Who is interested in spending the day with me and seeing what my life is about?” message on March 4.

3. Kenny Powers
The down-and-out pitcher/middle school gym teacher from “Eastbound & Down” reminded fans in his HBO show: “How many times do I got to tell you this, Gatorade is still trying to get a piece of my ass, the IRS is up in my [expletive] and I need to take a job just so the government can’t garnish my [expletive] wages.”

No word on the specifics of what Kenny owes, but given Powers’ promotional appeal at Ashley Schaeffer Motors, Kenny is hopefully now on the road to solvency.

4. Steffi Graf
What is it with Steffi’s financial life? First, her father totally dropped the ball by evading paying taxes on $6.55 million of her earnings in 1997, and her husband Andre Agassi reportedly challenged a 27,500-pound tax tab (and lost) in the UK for the 1998-99 season.

5. Pete Rose
Poor Pete is a repeat offender … the all-time hit king was hit with a $1 million tax lien in 2004, 15 years after he had to spend five months in federal prison on tax evasion charges in 1990. One item it appears Rose will never be able to itemize or expense is that special summer trip to Cooperstown (at least during his lifetime).

6. O.J. Simpson
The Juice got squeezed by the IRS for more than $700,000, according to 1997 reports.

7. Boris Becker
Becker was slammed with a $3 million tax bill but avoided jail time when he was convicted of tax evasion in 2002 after admitting he lived in Germany after first claiming to reside in Monte Carlo.

8. Meet the Mets (tie)
What is it with the following stars of ‘86 almost getting 86′d for failing to pay taxes?

A. Darryl Strawberry: Strawberry’s foul play included failing to report hundreds of thousands of dollars he earned at various baseball card signing events. Darryl was called out and ordered to pay $350,000 in back taxes in 1994, and since then the penalty has since ballooned to over $554,000 in 2009.

B. Kevin Mitchell: You might remember Kevin for his famous barehanded grab, but he could single-handedly put himself out as he is ranked the sixth-biggest IRS tax deadbeat in the entire state of California with over $5 million in taxes due.

C. Ron Darling: Once the darling of the Mets’ pitching rotation, Ron is currently featured in the TBS, SNY and WPIX announcers rotation. He was known for his pickoff move, and the IRS is trying to pick off $544,197 in back taxes from Darling. As NBCNewYork aptly put it: “Hopefully [Darling] can work this out without following Koosman into the pen, but to be sure, we recommend keeping Lenny Dykstra’s phone number as far away from Darling as possible.”

D. Jerry Koosman: OK, so Jerry is not from the ‘86 Mets, but the 66-year-old star of the ‘69 Mets recently pleaded guilty to tax-evasion charges. According to the New York Post, “When [IRS agents] asked why he didn’t file his taxes, he replied ‘Why should I?’ and asked to see a law that mandated it.” You gotta believe, Jerry. You gotta believe.

9. Lawrence Taylor
In 1996, No. 56 got 86′d for failing to file his 1040. LT was sacked for three months house arrest and five years probation and was flagged for 500 hundred hours of community service.

10. Diego Maradona
Maradona’s current worries involve the amount of rest he should give Messi before the World Cup, but prior to becoming coach of Argentina, Maradona was involved in a messy Italian tax imbroglio in 2001 which has not yet been to put to rest. We can’t help but wonder if Diego argued that he thought his missing tax forms were filled out by “The Hand of God.”

11. Anthony Mason
The former New York Knicks and Milwaukee Bucks star owes big bucks to the IRS. Anthony Mason has to be hoping his son, St John’s freshman Anthony Mason Jr., will go lottery one day … as Anthony Sr. is currently the 11th-biggest tax delinquent in the state of Wisconsin, owing more than $1.8 million in state and federal taxes.

12. Fielder’s Choice (tie)
Between Prince and his estranged father Cecil, the IRS slammed the heavy hitters with a hefty bill of close to $700,000 ($409,149 and $273,123.29 respectively).

13 Dennis Rodman
You might always think of Rodman as a nut, but he actually set a precedent when he kicked a cameraman in the — well, let’s say crotch — and was sued. The Worm would later settle out of court, but he wiggled his way into the tax laws as his case went all the way to the Supreme Court to determine if Uncle Sam would get a cut of out-of-court settlements. Some advice to a certain coed from Georgia … come tax time, remember the Worm.

14. Boxing Hits (tie)
A. Thomas “Hitman” Hearns: Hearns was hit with a $448,000 tax bill on top of having over $500,000 in overdue mortgage payments. In order to give himself a fighting chance, the Hitman decided to hold an auction of some his boxing memorabilia earlier this month.

B. Don King: Given his haircut, who would have thought when King listed $2.5 million worth of hair products as a business expense that it would have raised eyebrows with the IRS? All kidding aside, King faced 29 counts of tax evasion in 1985 when it was alleged he diverted over $1 million in corporate receipts to his personal use.

15. Denny McLain
MLB’s last 30-game winner almost saw 30 years in prison for drug trafficking, embezzlement and racketeering involving John Gotti Jr. in the 1980s. Now, McClain has a debt to the IRS of $1,019,998. We wonder which is scarier … being on bad terms with Uncle Sam or Godfather Gotti?