This October's DoJ Tax Division's highlights includes:
John Everson, who owned an electrical engineering business in Ohio, was convicted of tax evasion. Everson tried to conceal more than $1.3 million of income he earned from his business by instructing clients to make payments to a trust he controlled. Everson then used the money in the trust to pay personal expenses. Everson's conduct caused a tax loss of more than $500,000.
Scott Chappelle, a real estate developer in Michigan, was sentenced to 38 months for obstructing the IRS' attempts to collect his unpaid withholding and income taxes. Chappelle admitted he kept the taxes he withheld from his employees' wages but when the IRS tried to collect those taxes, Chappelle made false statements about his and his companies' assets to avoid having to pay the IRS.
Eugene R. Britt III, a bar and restaurant owner, pleaded guilty to tax evasion. Brit disguised his ownership in three bars and restaurant, skimmed cash from the gross receipts of the businesses and failed to report that income for approximately two decades.
Zeki Donuk, who operated a New Jersey construction business, was charged with tax evasion, employment tax crimes, filing false tax returns and making false statements in bankruptcy. According to the indictment, Donuk cashed checks payable to his business instead of depositing them into the business's account and didn't report the income on either the business or his personal returns. In addition, for at least a year Donuk failed to withhold employment taxes from his employees or file employment tax returns.
Clarence A. Joles Sr., the owner of an asphalt paving business, pleaded guilty to filing a false tax return. Joles admitted that he deposited his business's gross receipts into nine different bank accounts but failed to give his tax preparer the records from some of those accounts. This caused Joles to underreport his business income by more than $1 million.
Ronald Ray Wilson, a former member of the Texas House of Representatives, pleaded guilty to evading payment of taxes. In 2008 and 2011, Wilson stipulated to two Tax Court decisions finding that he owed taxes to the IRS. Subsequently, Wilson used his law firm's client trust account to conceal his income to avoid paying the stipulated amounts. Wilson also tried to conceal his pension and other assets causing a tax loss of approximately $794,632.
Joseph Garza, an attorney, was indicted by a federal grand jury in Dallas on charges of wire fraud and helping his clients file false tax returns. According to the indictment, from 2012 to 2021 Garza promoted a tax shelter that allowed his high-income clients to claim fraudulent tax deductions. The indictment alleges that Garza directed his clients to transfer funds into shell companies that then returned the money to the clients. To conceal the circular flow of funds, Garza allegedly commissioned fictitious business valuation reports, created invoices for fake business expenses and drafted sham contracts. Garza's scheme allegedly allowed his clients to hide approximately a billion dollars from the IRS and caused a tax loss exceeding $200 million.
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Read more at: Tax Times blog