According to a Department of Justice press release, a Texas couple was recently convicted by a federal jury of conspiracy to defraud the United States, as well as impeding government functions of the IRS. The charges were a result of an investigation into the business jointly owned by the couple. This story evidences the fact that the IRS will go after businesses ranging from large to small if its owners blatantly disregard their obligations under the tax laws. If you have failed to file a tax return for one or more years or you have received notification that your tax return has been selected for examination or criminal tax investigation by the IRS or state taxing authority, it is in your best interest to contact an experienced tax defense attorney as soon as possible.
Court documents reveal that Dick Brocato, Jr. and his wife, Judith L. Brocato, of Beaumont, Texas, were the owners and operators of Superior Lawn Service, a company that provided lawn care services to its customers. Prosecutors alleged and a jury agreed that the couple had failed to file true and accurate tax returns for the business. From 2012 through 2014, the couple filed intentionally false tax returns for Superior, indicating that it had earned much less than it had actually received.
Investigators uncovered that the Brocatos frequently cashed checks received by customers instead of depositing them into the bank account of the business. Although cashing checks without placing the funds into a business bank account is not, in and of itself, illegal, the business is still required to include the income in gross income on its tax returns, which Superior did not do.
The IRS estimates that proceeds from cashed checks that were not included in the gross income of the business on its tax return was over $500,000 in 2012, nearly $700,000 in 2013, and approximately $513,000 in 2014. Sentencing will likely not be scheduled until government functions begin opening back up to normal levels, but each faces up to five years in federal prison.
There are various ways to structure your business to allow for tax efficiency. Hiding assets or engaging in check cashing schemes are not legally permissible methods to implement a tax savings strategy. If you have failed to file tax returns for one or more years, or have engaged in conduct that may not be supportable by the law upon examination, it is in your best interest to contact an experienced tax defense attorney as soon as possible.
Your tax defense attorney will work with you to develop the particular facts and circumstances surrounding your situation. You will then work together with your tax counsel to determine the best plan of action moving forward, taking into account the particular wants and needs of the individual taxpayer.
See our Criminal Tax Law Q and A Library
See our Non-Filer Q and A Library
The tax and accounting professionals at the Tax Law Offices of David W. Klasing have extensive experience representing a diverse group of taxpayers. From individuals to middle-market businesses and beyond, our team of zealous advocates will assist in the development of a strategy to help you reach your specific goals and objectives. Whether you are under a tax examination or are in need of tax planning advice, contact the Tax Law Offices of David W. Klasing today, online or by phone at (800) 681-1295, for a reduced-rate consultation.
Here is a link to our YouTube channel: click here!
Regardless of your business needs, the professionals at the Tax Law Offices of David W. Klasing are here for you. We are open for business and our team will help ensure that your business is too. Contact the Law Offices of David W. Klasing today to discuss your business with one of our professionals.
In addition to our main office in Irvine, the Tax Law Offices of David W. Klasing has unstaffed (conference room only) satellite offices in Los Angeles, San Bernardino, Santa Barbara, Panorama City, Oxnard, San Diego, Bakersfield, San Jose, San Francisco, Oakland, Carlsbad and Sacramento. During the COVID-19 pandemic, our staff are working from home, but have full virtual meeting capability.
Our office technology allows clients to meet virtually via GoToMeeting. With end-to-end encryption, strong passwords and top-rated reliability, no one is messing with your meeting. To schedule a reduced-rate initial consultation via GoToMeeting follow this link. Call our office and request a GoToMeeting if you are an existing client.