According to a Department of Justice press release, the subject of one of our prior stories has found himself back in the news after he failed to report to serve his prison sentence, last year. As we have indicated time and time again, taking tax matters with severe criminal implications into your own hands can be extremely dangerous. Taxpayers should strongly consider seeking the guidance of an experienced criminal tax defense attorney if they have received notice that their tax returns have been selected for examination or if they believe that they are not compliant with their annual tax filings, among many other reasons.
Business Owner Sentenced but Failed to Report to Prison, Faces Additional Prison Time
Last year, we covered the story of Lawrence Martin Birk’s conviction for tax evasion. After trial, he was sentenced to serve 60 months in a federal prison and was ordered to report in November of 2019 for processing into the federal prison system. Birk never surrendered and became a fugitive until he was captured earlier this year. Now, a Denver federal grand jury has returned an indictment for failing to surrender. If convicted, Brik’s sentence will likely be extended, turning a five-year prison stint into something much longer.
As we reported last year, Birk was the owner and operator of Tarryall River Log Homes since 2000. Birk’s company was profitable and in nearly any other scenario, would pay taxes on its profit. Prosecutors alleged that Birk aligned himself with certain tax protestor organizations, who believe that its members are not obligated to pay U.S. Federal tax.
Since the company’s inception, Birk failed to pay federal income tax on Tarryall River Log Homes income, nor did he pay individual income tax. Upon learning of Birk’s nonpayment, the IRS initiated collection efforts and even visited Birk at his home. Birk hired a tax firm to prepare several years of delinquent returns upon which he admitted to owing tax on his income over the years. Though, Birk’s delinquent tax returns failed to report over $400,000 of retirement income that he intentionally routed through a shell company.
Although Birk admitted to owing tax, he failed to pay the amount of tax due on the tax returns. Prosecutors alleged that Birk sent threatening letters to the IRS that cited non effective tax protestor arguments that he sourced from the tax protestor organizations to which he belonged.
When the IRS collection efforts escalated to the seizure of the funds in Birk’s bank account, he intentionally thwarted collection efforts by purchasing cashier’s checks to reduce the balance in his accounts. The IRS and Department of Justice estimate that his outstanding tax debt through 2005 are over $2 million. Additionally, Birk did not file tax returns (or make any payments of tax) for income earned from 2006 through 2018. In total, the government estimates that his tax debt is over $3.5 million.
Common issues with IRS collection actions
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When to Contact a Tax Lawyer
This story reflects our ongoing message to taxpayers: when the IRS or state taxing authority contacts you, whether it be related to an audit or a criminal tax investigation, it is in your best interest to contact an experienced tax defense attorney as soon as possible. A seasoned tax lawyer will work with you to develop and implement a strategy that keeps your financial and physical freedom top-of-mind.
Contact an Experienced Tax Attorney Today
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.
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Note: As long as a taxpayer that has willfully committed tax crimes self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosure before the IRS has started an audit or criminal tax prosecution, the taxpayer can be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously receive a break on the civil penalties that would otherwise apply. It is imperative that you hire an experienced and reputable tax defense attorney to take you through the voluntary disclosure process. As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, Kovel CPAs and EAs, our firm provides a one stop shop to efficiently achieve the optimal and predictable results. See our Testimonials to see what our clients have to say about us!
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Will it cost me more to hire the Tax Law Offices of David W. Klasing, who’s main office and the vast majority of the firm’s staff is located in Irvine California, but an appointment only Satellite office is close to my location, as opposed to a local company? Absolutely not! See our policies that address this issue here.
