According to the Department of Justice, U.S. Attorney’s Office, District of Massachusetts , The Owners of A Payroll Company were Sentenced for defrauding the IRS and Tax Evasion.
A 73 year old Massachusetts man (President of the company) was sentenced to one year and one day in prison, three years of supervised release and restitution of $1,825,933 He plead guilty to two counts of conspiracy to defraud the IRS, four counts of making false statements in tax returns, four counts of tax evasion, and one count of wire fraud. His partner, whom is his also his son a 43 year old man ( Treasurer of the company) was sentenced to eight months in prison and three years of supervised release. He plead guilty to two counts of conspiracy to defraud the IRS and four counts of tax evasion. A 74 year old Florida man, ( Former President who Retired from the company in 2010)was sentenced to six months in prison and three years of supervised release. He plead guilty to one count of conspiracy to defraud the IRS, and three counts of tax evasion.
Beginning around 2006, The President and former President operated two corporate bank accounts at a Savings Bank. From 2007 to 2012, they funneled approximately $11 million of taxable income into these accounts. The Current President and the Treasurer kept these accounts off of the corporation’s books and concealed their existence from the corporate accountant. Thus, the income deposited into these accounts was not reported to the IRS on the corporation’s annual tax returns. As a result, the corporation failed to pay approximately $3.78 million in taxes.
Also during that time, The current President of the Company wrote checks totaling approximately $4.7 million from one of the corporate accounts to himself, The Treasurer and Former President of the Company. In addition, from 2007 to 2011, they all received bonus and dividend checks totaling approximately $2.7 million, which never appeared on the appropriate tax reporting forms, and as a result, the defendants failed to pay approximately $1.7 million in taxes from 2007 through 2011.
The President of the Company was also convicted in stealing $1 million from client trust accounts and $750,000 from their tax accounts.
Leave a Reply.
We're Here to Help
Get advice from our experienced network of financial managers.
If you Value our Blog, We have an ask.
We spend hours researching data to help you understand your finances and taxes, including historical context, issues, and solutions. Our goal is to empower people to improve their relationship with money. Please consider a $3 donation today.
Spencer Accounting Group, LLC does not provide investment, tax, legal, or retirement advice or recommendations in these blogs. The information presented here is not specific to any individual's personal circumstances.
Keana Spencer is an Accountant, Entrepreneur, and Educator to her clients, with a strong passion. Keana has over 10 years of experience and through her practice, she is a source of knowledge and strategies to her clients.