We may have a new President, but it’s the same old tax fraud. Please, don’t try any of these yourself.
>From Snohomish, Washington comes a crime that’s guaranteed to get yourself sent to ClubFed. Simply take the trust fund (FICA and Medicare) taxes that are being withheld from your employees’ paychecks and rather than sending them to the IRS, keeping them for yourself. Using them on trips to Hawaii and Disneyland will only make things worse. That’s what Lynda Mead did, and she’ll have just under three years at ClubFed to think it over. She also must make restitution of $537,000 (including penalties and interest).
Joseph J. Smith and Cynthia McDonough owned two auto body shops in Philadelphia. They were profitable, to the tune of over $1 million from 2001 to 2004. Their income after taxes was the same as their income before taxes—they didn’t report that income to the IRS. Nor did they report income from the sale of two homes. The IRS discovered this and wasn’t pleased. The couple was indicted on tax fraud charges. Last week they were convicted on those charges. Each is looking at a lengthy term at ClubFed, fines, and probable restitution.
Moving closer to home, Giancarlo Pertile owned Art Marble Design Inc. in Moorpark, California. Mr. Pertile followed the same pattern as Mr. Smith and Ms. McDonough: Just don’t report the income. He moved it to bank accounts that his bookkeeper, accountant, and the IRS didn’t know about…for awhile. But then the IRS found out about the tax fraud (which occurred between 1998 and 2002). Mr. Pertile was convicted last week of five tax evasion charges. He’ll be sentenced in May and is looking at a stay at ClubFed, fines, and probable restitution.
Finally, Rick Jones was a developer in Wood River, Illinois. Mr. Jones went through a divorce a couple of years ago, and his financial records came to light. While he reported $1.74 million of income in 2003 the divorce records showed a much higher figure. The IRS got interested and Mr. Jones pleaded guilty to tax evasion this past week. It turns out his real 2003 income was about $5.25 million. Mr. Jones paid $538,000 in tax but he should have paid $1.77 million. He’s looking at a stay at ClubFed, a fine, and restitution.
I’ve said many times that if you don’t remit trust fund taxes bad things will happen to you. I’ve also said that if you’re a tax evader, don’t get a divorce. This week shows again that the more things change, the more they stay the same.
if you’re a tax evader, don’t get a divorce
Excellent idea. I wonder what the divorce rate among tax evaders is. Tax evasion might actually rescue some marriages, because it would make divorce so expensive. On the other hand, the folks who lie to the IRS might find themselves in hot water with their spouses over the same tendency.