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In an update to a previous story that we brought you in 2019, a Michigan restaurant and “adult entertainment establishment” owner has been sentenced to serve two years in federal prison after being convicted of various tax crimes. The lesson here? Business owners should keep potential civil and criminal tax exposure on the top of their mind, especially as we move into tax season and the government is looking for taxpayers to make an example of. If you have failed to file a tax return for your business or have failed to properly report income or items of deduction, you should contact an experienced business tax attorney to come into federal tax compliance, especially where you intentionally cheated, and remove the risk of incarceration through a domestic or offshore voluntary disclosure or by amending returns depending on the potential risk involved.
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!
According to a Department of Justice press release, Johni Semma, the owner of Bayside Sports Bar & Grill and The Coliseum was sentenced to serve 24 months in federal prison after being convicted of one count of employment tax fraud and one count of failure to file his individual income tax return.
As we previously reported, federal prosecutors alleged and Semma pleaded guilty to willfully failing to properly account for and pay over payroll taxes from 2008 through 2015. Semma withheld payroll taxes from his employees’ paychecks but failed to file 27 of 29 Forms 941 and intentionally failed to remit over $1.3 million of those employment taxes. When Semma sold The Coliseum, he received more than $6 million in sales proceeds. Nonetheless, he did not clear up the payroll taxes that he had previously failed to pay.
Lastly, Semma appeared to have carried his failure to comply with tax laws on to his own tax returns. As a part of his guilty plea, Semma admitted to failing to file an individual income tax return in 2012. The failure to file was estimated to have resulted in a loss of tax revenue to the IRS of over $460,000. In addition to being ordered to serve two years in prison, Semma was ordered to pay over $1.7 million in restitution to the IRS.
Whether you have failed to file a business tax return for one or more years, have understated gross receipts, overstated deductions, claimed credits to which you were not entitled, or failed to comply with employment tax obligations, it is critical that you identify and resolve any significant tax exposures. An experienced tax defense attorney will assist in laying out the particular facts of your case and help you develop a strategy to get right with the government. When you are represented by a seasoned tax lawyer, you will not have to go up against the IRS or state taxing authorities alone.
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.
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.
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