For the second week, although a day late this time (the inaugural roundup was May 4), I did a search of tax crimes. Here’s the current batch of convicted tax miscreants.
We start with a former IRS director, Jesse Ayala Cota, who pleaded guilty in a Kansas City, Kan., court to promoting a tax-fraud scheme through his accounting firm.
Cost to the U.S. Treasury: $1.3 million. Cota, according to court documents, pocketed $300,000.
Between 1997 and 2002, he prepared bogus tax returns based on “false and misleading representations” to clients. Cota admitted to using his former position with the IRS in San Diego to convince clients that they were eligible for illegal tax deductions.
We stay in the heartland for a millionaire couple convicted of tax fraud after taking advantage of benefits meant for working families. James and Shirley Aldridge were found guilty last week of five counts each of aiding and abetting the filing of false tax returns between 2000 and 2004.
Court documents revealed that the couple, who lives in the Kansas City suburb of Lee’s Summit, Mo., reportedly earned more than $1.6 million, which they hid from the Internal Revenue Service through a personal charitable foundation and a series of trusts.
Then, according to trial evidence, the Aldridges claimed the earned income tax credit, a tax break designed to benefit the working poor. The false claim allowed them to evade more than $650,000 in federal taxes.
Our third tax cheat comes from Montana, where Rolan Becker of Ronan was found guilty by a federal jury of three counts of tax fraud. Becker failed to pay taxes or file returns for three years, starting in 2000.
Prosecutors said Becker also filed false W-4 forms to avoid having federal taxes withheld from his paycheck and transferred his home and vehicles to limited liability corporations so they could not be seized to pay back taxes.
The tax toll came to around $30,000 in back IRS obligations; the amount will go up when interest and penalties are added.
Finally this week, we have a Providence, R.I., accountant sentenced to a year in prison for filing false tax returns over four years.
Irwin Kalmer pleaded guilty last December to failure to report about $313,000 in income earned for tax years 1999 to 2002. In addition to the jail time, which he must start serving by July 13, Kalmer also paid $88,000 in back taxes, plus interest and penalties, and surrendered his accounting license.
There were more, but I have other things to do this Saturday night.
So that’s our line-up for this Mother’s Day weekend. Not really a group to
make a mother proud, unless mom happened to be Ma Barker.
Kay
Oops! My bad. I meant to check that, but then the hubby announced the pizza was ready and I went down to eat and forgot! Thanks for the geography lesson. I’ve corrected the post.
dimes
(psst: Lee’s Summit, a suburb of KC, is actually in MO)
I would like to learn how someone structures trusts or corporations in order to successfully (well, until they’re caught) shirk personal income tax responsibility. Not because I’m planning on doing it myself, but because these schemes always sound so complex and I’d just like to see how they’re pulled off.