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Michigan Businessman Charged With Various Tax Crimes Including Tax Evasion

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Michigan Businessman Charged With Various Tax Crimes Including Tax Evasion

 

 

According to a Department of Justice press release, a Michigan business owner was recently charged with tax evasion, obstructing the IRS, and failing to file an individual income tax return. This story should remind business owners that although it may be easy to commingle your business and personal affairs, there can be disastrous consequences, particularly if you lie to the IRS about your true income and items of expense. If you have filed a tax return that does not accurately reflect your business’s income or have failed to file a business or individual tax return, it is in your best interest to contact an experienced tax defense attorney to determine your options to come into compliance.

DOJ Alleges the Defendant Concealed Business’s True Profits

Court records reveal that Ryan Richmond was the owner and operator of Relief Choices LLC, a marijuana dispensary, serving clients in Warren, Michigan. IRS investigators and DOJ prosecutors allege that between 2011 and 2014, Richmond caused his business to route customer payments through a nominee bank account, concealing the true amount of income collected by the business. Furthermore, government investigators believe that Richmond caused the business to use cash to pay for expenses to conceal the amount of business expenses incurred.

When pressed on the above issues, in addition to the functions performed and income earned by Richmond, prosecutors allege that Richmond lied to the IRS to obstruct their investigation. Finally, the IRS and Department of Justice allege that Richmond willfully failed to file an individual tax return.

If Richmond is convicted, he faces up to five years in prison for each count of tax evasion, up to three years in prison for obstructing the IRS, and one year in prison for willfully failing to file an individual tax return. He could also face a sentence of supervised release upon the completion of any physical incarceration. Lastly, if convicted, Richmond will likely be ordered to pay restitution to the IRS, representing the tax loss that he caused.

Coming into Compliance After Falling Behind

Many business-owning taxpayers around the country take advantage of a perceived opportunity to lower their tax liability by underreporting income, inflating the amount of their deductions, and commingling funds so that business funds are used to pay for personal expenses. Although some taxpayers engage in such activity, the repercussions of being caught are not worth the potential benefit. Taxpayers who are caught intentionally lying on their tax return face lengthy heft monetary penalties and can even face time in a federal prison.

If you have failed to file a tax return for one or more years or have taken a position on a tax return that could not be supported upon an state or federal audit or criminal tax examination, it is in your best interest to contact an experienced tax defense attorney to determine the best strategy to bring you into tax compliance. Your seasoned tax attorney will help ascertain the pertinent facts of your case and work with you to mutually develop a strategy to get right with the government while preserving your financial and physical freedom.

Note: As long as a taxpayer that has willfully committed tax crimes (potentially including non-filed foreign information returns coupled with affirmative evasion of U.S. income tax on offshore income) self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosurebefore the IRS has started an audit or criminal tax investigation / prosecution, the taxpayer can ordinarily be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously often receive a break on the civil penalties that would otherwise apply. 

It is imperative that you hire an experienced and reputable criminal tax defense attorney to take you through the voluntary disclosure process. Only an Attorney has the Attorney Client Privilege and Work Product Privileges that will prevent the very professional that you hire from being potentially being forced to become a witness against you, especially where they prepared the returns that need to be amended, in a subsequent criminal tax audit, investigation or prosecution.

Moreover, only an Attorney can enter you into a voluntary disclosure without engaging in the unauthorized practice of law (a crime in itself). Only an Attorney trained in Criminal Tax Defense fully understands the risks and rewards involved in voluntary disclosures and how to protect you if you do not qualify for a voluntary disclosure.

As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, KovelCPAs and EAs, our firm provides a one stop shop to efficiently achieve the optimal and predictable results that simultaneously protect your liberty and your net worth. See our Testimonials to see what our clients have to say about us!

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Regardless of your business or estate 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.

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