Source: http://oicattorney.blogspot.com/2009/08/under-section-7206-individual-was.html
Timestamp: 2017-08-18 08:50:34
Document Index: 258133396

Matched Legal Cases: ['§ 7206', '§ 7206', '§ 7206', '§ 2', '§ 7212', '§ 401', '§ 7212']

[Under section 7206 an individual was properly convicted of aiding and assisting in the preparation of false tax returns, preparing and filing false tax returns, and impeding the IRS in its due administration of the federal tax laws. IRS agents were properly allowed to remain in the courtroom during the trial after the individual invoked the rule of sequestration because they aided the orderly presentation of the case, which they could not have done without hearing the evidence introduced during the course of the trial. Evidence showing that prior to the commencement of the trial, the court held one of the individual's clients in civil contempt for violating an order to provide documents to the IRS, did not unfairly prejudice the individual. The jury indicated that the individual only impeded the IRS by filing tax returns stating zero income and zero taxes due and owing. Finally, governmental witnesses' testimonies concerning the individual's conduct and tax protestor theories were relevant to the jury's determination regarding whether he had acted in good faith. None of the witnesses actually stated that the individual was a tax protestor.
United States of America, Plaintiff-Appellee v. Louis Wayne Ratfield, Defendant-Appellant. 2009-2 USTC ¶50,592
U.S. Court of Appeals, 11th Circuit; 07-13537, August 18, 2009.
Before: Edmondson, Black and Siler, Circuit Judges.
Before EDMONDSON, BLACK and SILER, * Circuit Judges.
PER CURIAM: Louis Wayne Ratfield appeals his conviction for preparing and filing false tax returns, specifically, (1) aiding and assisting in the preparation of false federal tax returns for trusts and estates (IRS Form 1041), in violation of 26 U.S.C. § 7206(2) (Counts 1-20); (2) aiding and assisting in the preparation of false individual and joint federal tax returns (IRS Form 1040), in violation of 26 U.S.C. § 7206(2) (Counts 21-42); (3) filing false federal income tax returns in violation of 26 U.S.C. § 7206(1) and 18 U.S.C. § 2 (Counts 43-45); (4) impeding the Internal Revenue Service in violation of 26 U.S.C. § 7212(a) (Count 46); and (5) willfully and knowingly disobeying and resisting the lawful orders issued by a United States District Judge for the Southern District of Florida during proceedings held in United States v. Louis W. Ratfield and LWR Financial Services Trust, Case No. 01-cv-8816, by committing acts that he knew to have been enjoined, or by failing to perform acts that he had been ordered to perform, in violation of 18 U.S.C. § 401(3) (Counts 47-56). 1 A jury returned a verdict convicting Ratfield on all counts of the indictment except for Count 50. 2
We have had oral argument in this case and the parties are intimately familiar with the facts, so we will not extensively review the facts. Ratfield raises three issues on appeal: (1) whether the district court abused its discretion by allowing IRS revenue agent-witnesses to remain in the courtroom during the trial after Ratfield invoked the rule of sequestration; (2) whether the district court abused its discretion by admitting evidence showing that six years before Ratfield's trial commenced, the district court held one of Ratfield's clients in civil contempt for violating an order to provide documents to the IRS; and (3) whether the district court abused its discretion by admitting testimony from IRS agents that Ratfield was a tax protester, that his arguments were frivolous, and that trusts he set up were abusive and a sham. We address these arguments in turn.
Ratfield argues the district court abused its discretion by allowing two IRS agents to remain in the courtroom after Ratfield invoked the sequestration rule, Fed. R. Evid. 615.
Rule 615 provides, in relevant part, "At the request of a party the court shall order witnesses excluded so that they cannot hear the testimony of other witnesses." Nevertheless, the rule "does not authorize exclusion of ... an officer or employee of a party which is not a natural person designated as its representative by its attorney, or [] a person whose presence is shown by a party to be essential to the presentation of the party's cause." A decision regarding who will be excused from the rule of sequestration is within the trial judge's discretion and will be reversed only upon a clear showing of abuse of discretion. United States v. Alvarado, 647 F.2d 537, 540 (5th Cir. Unit A June 1981) 3 (finding the trial court did not abuse its discretion in excusing two drug enforcement agent-witnesses from sequestration requirements).
The district court did not abuse its discretion in deciding to allow the two IRS agents to remain in the courtroom during trial. Agent Grimes testified as a fact witness, an expert witness regarding trusts and taxation, and as a summary witness regarding Ratfield's evolving theories of the taxation of common law trusts. Agent Grimes' testimony aided the jury in understanding the significance of Ratfield's statements, the testimony of the other revenue agents, and the testimony of Ratfield's clients. Her testimony also permitted the other revenue agents to testify primarily as fact witness and avoid repetitive testimony regarding tax laws. Agent Grimes summarized Ratfield's evolving theories regarding the taxation of common law trusts, based on the testimony of other witnesses and documents introduced into evidence. 4 She could not have done so had she not heard the evidence introduced during the course of the trial.
Agent Lottman testified about his calculation of Ratfield's taxable income and also as a summary witness regarding the total tax loss to the Government. 5 There was little, if any, overlap in the testimony of Agents Grimes and Lottman because they focused on different aspects of the case. Consequently, we find unpersuasive Ratfield's contention they tailored their testimony to bolster each other or the testimony of the eleven other IRS agents, who testified regarding their audits of Ratfield's clients and their individual dealings with Ratfield.
The jury was able to view and assess the credibility of these witnesses. The district court's decision to allow Agent Grimes and Agent Lottman to remain in the courtroom aided the orderly presentation of the case. There were adequate grounds to permit both IRS agents to remain in the courtroom, so we find no abuse of discretion in excusing them from the sequestration rule.
Ratfield argues the district judge abused his discretion by allowing the jury to hear evidence that he had previously decided the issues against the defendant's position in a prior, related case. According to Ratfield, the introduction of this evidence, which concerned one of the Government's witnesses, was so prejudicial as to make the trial unfair. Additionally, he argues the attempt at a curative instruction was insufficient to cure the prejudice.
District court rulings on the admissibility of evidence are reviewed for a clear abuse of discretion. United States v. Brannan, 562 F.3d 1300, 1306 (11th Cir. 2009). In determining whether the district court erred in failing to exclude relevant evidence under Fed. R. Evid. 403, we give deference to the discretion of the district judge, looking "at the evidence in a light most favorable to its admission, maximizing its probative value and minimizing its undue prejudicial impact." United States v. Elkins, 885 F.2d 775, 784 (11th Cir. 1989).
Ratfield fails to show how he was unfairly prejudiced by Frederick Crawford's testimony, which was only relevant to Count 46, impeding the IRS in violation of 26 U.S.C. § 7212(a). During trial, the Government introduced court documents, which had been signed by Judge Hurley six years earlier, that included (1) an order to Crawford, one of the Government's witnesses in Ratfield's case, to produce documents to the IRS, (2) an order to show cause related to the order to produce documents, and (3) an order incarcerating the witness for failure to comply. Ratfield argues Crawford and the Government purposefully mentioned the judge by name numerous times during the testimony to prejudice Ratfield. After Ratfield objected, Judge Hurley instructed the jury that they should not take it as any indication of what he thinks their verdict should be in the case. The judge then instructed the jury as follows:
Ladies and gentlemen, as you can imagine, there are lots of things that come before The Court. This is the first time I realized that I had any prior involvement dealing with Mr. Crawford and Mr. Crawford's relationship with Mr. Ratfield.
I want to make sure the jury understands that they cannot in any way take that as indicating that I have any view at all in terms of what the verdict should be as to Mr. Ratfield or whether the Government has proof in terms of Mr. Ratfield's situation.
The only thing I was looking at obviously with Mr. Crawford is the statute that requires people to turn over books and records, and if they have the ability to do it and don't do it, the Court has what is called civil contempt power which effectively says to someone, if you don't turn it over, you will be held in jail until you do turn it over. It is a coercion to say to somebody you have the key to the jail cell yourself, you get out by turning over the records if you have them.
I want to be very clear. I want to really emphasize to the jury they should not in any way, number one, consider that I have any view at all on the merits in terms of the charges against Mr. Ratfield. I assure you I do not. Those are matters for you, the jury, to decide. The fact that there is some prior proceeding that was related principally to Mr. Crawford as he indicated to us.
There is no reason to conclude the jury did not follow the district court's instructions and consider Crawford's evidence only with respect to Count 46 and not with regard to the criminal contempt charges. 6 Moreover, the jury indicated on the special verdict form, that the only manner in which Ratfield impeded the IRS was by filing tax returns stating zero income and zero taxes due and owing. Therefore, the district court did not abuse its discretion in admitting the evidence.
Ratfield argues he was unfairly prejudiced when numerous IRS agents were permitted to testify that he was a tax protester, that his arguments were frivolous, and the trusts he set up were abusive and a sham. Ratfield also contends the prejudice was compounded when the judge instructed the jury that he was allowing the testimony about Ratfield being a tax protester because the good faith defense is not available to someone making tax protester arguments.
In determining whether the district court erred in failing to exclude relevant evidence under Rule 403, we give deference to the discretion of the district judge, looking at the evidence in a light most favorable to its admission, and will reverse only upon a clear showing of abuse of discretion. Elkins, 885 F.2d at 784; Brannan, 562 F.3d at 1306.
The district court did not abuse its discretion in allowing the IRS agents' testimony. At trial, the ultimate issue the jury decided with respect to the charges relating to the filing of false tax returns (Counts 1-46) was whether Ratfield acted in good faith. Contrary to Ratfield's claims, none of the Government's witnesses testified Ratfield was actually a tax protester. The record shows that Dr. Olson, one of Ratfield's clients, testified that he asked Ratfield if he wanted to go down the path of what looked like being a tax protester. Agent Grimes testified the arguments Ratfield made to the IRS were "protester type arguments."
Likewise, none of the witnesses opined that Ratfield's arguments were frivolous in the sense that he did not have a good faith belief in them. Instead, they testified they treated his arguments as frivolous, which meant they were not required to provide a point-by-point refutation to his theories on income taxation or his challenges to their authority to conduct audits.
Agent Grimes explained that the IRS defined an "abusive trust" as a trust set up to avoid taxes. The other agents accurately applied the terms "sham" and "abusive" in that manner in their testimony. The IRS agents testified that, based upon their training and experience as revenue agents, they recognized the trusts Ratfield had set up for his clients were abusive because the person who controlled the trust was also the beneficiary. Moreover, the evidence was overwhelming that Ratfield set up the trusts so that he and his clients could reduce or eliminate their income tax payments.
The only issue was whether Ratfield acted in good faith. The district court gave a comprehensive instruction on the good faith defense and specifically instructed the jury:
Let me tell you, I've said before that in this tax area, the Government must prove that someone acted willfully.
When the issue of good faith has been raised, that requires the Government to prove that the person did not have a good faith subjective belief that they were following the law or that, to show that they misunderstood the law.
Now, I've explained this before. The reason for this in the one area of the law is that Congress recognizes that the tax laws are complex, so if somebody has a good faith belief that they are not violating the law, even though their position may seem really quite extraordinary, if they hold that in good faith, if they really believe that, that is a complete defense.
Now, I'm allowing this testimony about tax protest in because that good faith defense is not available if what someone is really doing is just acting as a tax protester.
In other words, the theory of the good faith defense is that somebody intends to follow the tax laws, but they just misunderstand them, and they in good faith believe what they are doing is not a violation of the law.
If somebody is really against paying tax at all, and they are just making up language, that good faith doesn't apply.
But I want to be sure that the jury understands these issues are issues for the jury to decide. They are factual issues.
And in allowing the agent to testify about this concept, I am not in any way suggesting that you need to accept these categorizations.
It is for the jury to make those ultimate determinations as to whether the Government has or has not proven that Mr. Ratfield did not have a good faith belief, and again, it will be for the jury to decide whether this tax protester issue is in place in this case or not.
Based on our review of the record, the Government's witnesses did not opine whether Ratfield acted in good faith. The witnesses' testimony concerned Ratfield's conduct, his evolving theories on the IRS's authority to tax and the taxation of trusts and the fact that they advised him his theories lacked any support in the law. This testimony was relevant to the jury's determination whether Ratfield acted in good faith. Ratfield's argument he was unfairly prejudiced by the IRS agents' testimony and the jury instruction on the good faith defense is without merit. We conclude the district court did not abuse its discretion.
1 On March 15, 2007, the district court granted the Government's motion to dismiss Counts 16, 21, 27, 29 and 36 of the indictment with prejudice.
2 The jury failed to indicate a verdict for Count 50 on the verdict form, so it was dismissed with prejudice.
3 In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), this Court adopted as binding precedent all decisions of the former Fifth Circuit handed down prior to the close of business on September 30, 1981.
4 In tax evasion cases, courts permit IRS agents to testify as summary witnesses. See, e.g., United States v. Stierhoff, 549 F.3d 19, 28 (1st Cir. 2008) ( "We hold, therefore, that in a tax evasion case, a summary witness may be permitted to summarize and analyze the facts of record as long as the witness does not directly address the ultimate question of whether the accused did in fact intend to evade federal income taxes."); United States v. Gold, 743 F.2d 800, 817 (11th Cir. 1984) ( "[T]his court has expressly approved the use of expert legal testimony in a case where an IRS agent merely stated his opinion as an accountant with regard to the tax consequences of a transaction, and did not attempt to assume the role of the court.") (internal quotation omitted).
5 Ratfield also argues the district court erred by allowing Agent Lottman to testify as to the ultimate issue in the case, which Ratfield describes as whether he impeded the IRS from determining the correct tax due. Ratfield complains the admission of Lottman's expert opinions was unduly prejudicial, violating Fed. R. Evid. 403, and Lottman should not have been allowed to tell the jury what verdict to reach. This claim was not raised in the district court, thus it is subject to plain error review. See Fed. R. Crim. P. 52(b); United States v. Pielago, 135 F.3d 703, 708 (11th Cir. 1998).
The jury was instructed that the ultimate issue in Count 46 was whether Ratfield had specifically intended to impede and obstruct the IRS by, inter alia, having his clients file tax returns and other documents that he knew to be false and frivolous. The district court instructed the jury that in order to find Ratfield guilty of Count 46, it would have to find beyond a reasonable doubt that Ratfield knowingly endeavored to obstruct or impede the IRS and that he did so corruptly. A review of the record shows Agent Lottman did not offer any testimony regarding his opinion about what Ratfield intended, so he did not invade the jury's province as fact-finder.
6 At trial, the evidence was overwhelming that Ratfield violated the preliminary and permanent injunctions.
Evidence. --Fraud and False Statements: Evidence
The U.S. Supreme Court remanded a case involving the government's failure to produce certain material in its possession when requested to do so by the defendant's attorney. The case was remanded for reconsideration in light of a decision in a nontax case ( Agurs, 427 US 97).
D.L. Leveto, DC Pa., 2000-1 USTC ¶50,278. Aff'd on another issue, CA-3, 2001-2 USTC ¶50,536, 258 F3d 156.
B.R. Rosco, CA-9 (unpublished opinion), 2000-1 USTC ¶50,355, 215 F3d 1335. Aff'g an unreported District Court decision.
T.C. Gaskill, CA-9 (unpublished opinion), 2000-2 USTC ¶50,702, 232 F3d 897. Rev'g and rem'g in part an unreported District Court decision.
K.P. Kontny, CA-7, 2001-1 USTC ¶50,197, 238 F3d 815. Cert. denied, 5/14/2001.
F.F. Paul, CA-6 (unpublished opinion), 2003-1 USTC ¶50,222, 57 FedAppx 597, aff'g, per curiam, an unreported District Court decision.
W.A. Montes, CA-4 (unpublished opinion), 2003-1 USTC ¶50,274, 57 FedAppx 569, aff'g, per curiam, an unreported District Court decision.
Y.B. Yang, CA-7, 2007-1 USTC ¶50,395, 478 F3d 832.
R.E. Reiss, CA-8 (unpublished opinion), 2007-2 USTC ¶50,532, 230 FedAppx 629, aff'g, per curiam, an unreported DC Minn. decision.
J.F. Greve, CA-7, 2007-2 USTC ¶50,547, 490 F3d 566.
The president of a tax preparation business was properly convicted for aiding and abetting the filing of false tax returns and conspiring to defraud the government. The evidence at trial established that the individual, not his alleged co-conspirator, was exclusively responsible for electronically filing returns for his business and for printing refund checks for his clients. He prepared his clients' fraudulent tax returns by reporting non-existent income from another business entity, thereby increasing their earned income tax credit. Moreover, the individual consciously made attempts to conceal his conduct by making cash payments to his clients.
M. Okonkwo, CA-11 (unpublished opinion), 2007-2 USTC ¶50,624, aff'g, per curiam, an unreported DC Ala. decision.
An individual's conviction for failing to report his income received from gambling winnings and filing false income tax returns was proper. The trial court did not abuse its discretion in allowing the IRS agent to submit rebuttal evidence that detailed transactions which the taxpayer's accountant had not taken into account in determining the taxpayer's net gambling income. Since the accountant's calculations and conclusions were not fairly and adequately presented in the defendant's case-in-chief, the IRS agent's critique of that report was properly offered in rebuttal to disprove the accuracy of the accountant's calculations.
C.J. Bland, CA-6 (unpublished opinion), 2007-2 USTC ¶50,731, aff'g an unreported DC Ky. decision.
The government presented sufficient evidence to support an individual's conviction for filing false returns. The government provided his original tax returns, which stated his income, and the Forms 1040X that he later filed showing his adjusted gross income as zero. He knew his argument that domestic income of American citizens is not taxable under the Internal Revenue Code was invalid and that the amended returns he filed based on that argument were false.
C.T. Clayton, CA-5, 2007-2 USTC ¶50,775, 506 F3d 405, aff'g, per curiam, an unreported DC Texas decision.
An individual's conviction and sentence for aiding and assisting in the filing of a false income tax return was vacated and remanded for a new trial. The district court wrongfully excluded the expert testimony of the individual's psychiatrist, who offered evidence on the effect of the individual's mental disorder on his ability to form the intent to evade the tax laws. The testimony was highly probative because it would have materially assisted the jury in determining whether the individual committed a voluntary, intentional violation of a known legal duty.
L. Cohen, CA-9, 2008-1 USTC ¶50,111, 510 F3d 1114.
A federal district court properly convicted and sentenced an individual for filing false individual income tax returns because he failed to report income diverted from his company to pay off his gambling debts. The district court did not abuse its discretion when it did not admit expert psychiatric evidence and the testimony of a forensic accountant that the individual claimed would have demonstrated that he was a pathological gambler and would have rebutted the government's evidence characterizing his transactions as diversions or misappropriations. The court found that the expert evidence and testimonies were irrelevant and lacked probative value with respect to the question whether the individual possessed the specific intent to willfully file a false tax return. Moreover, the evidence, if admitted, would have confused the jury.
S.K, Hayez, CA-4 (unpublished opinion), 2008-1 USTC ¶50,137, aff'g an unreported DC N.C. decision.
The winner of a reality television show failed to establish that he was improperly convicted and sentenced for filing false tax returns. Neither he nor his witnesses proffered any testimony or produced any evidence that demonstrated his belief that he had no legal duty to pay taxes on his winnings. The trial court also properly restricted the testimony of a witness for the individual regarding the competency of the accountants who had prepared his returns since it was irrelevant to the individual's intent.
R. Hatch, CA-1, 2008-1 USTC ¶50,166, 514 F3d 145.
An individual's conviction and sentence for preparing false and fraudulent tax returns was proper. There was sufficient evidence for the jury to find that the tax returns at issue were materially false. Evidence of flight was properly admitted because of his failure to appear in court for at least one scheduled hearing. Further, the testimony of the individual's attorney on his prior willingness to plead guilty was properly admitted since the individual had explicitly waived his right to the attorney-client privilege on that issue.
P.A. Triumph, CA-2 (unpublished opinion), 2008-1 USTC ¶50,197, aff'g an unreported DC Conn.decision .
An individual's conviction for willfully assisting the filing of a false tax return was proper. A tax return was properly admitted into evidence to establish the existence of an improperly claimed deduction. Moreover, the individual had the opportunity to confront the witness who testified against him and there was sufficient evidence to support the jury's finding that the return was false.
H.S.H. Wong, CA-9 (unpublished opinion), 2008-1 USTC ¶50,205, aff'g an unreported DC Nev. decision.
An individual was properly convicted and sentenced for willfully aiding and assisting in the preparation and presentation of false tax returns. The evidence presented at trial supported her conviction because, even though the IRS was contacted and asked to disregard it, the individual had prepared a false tax return. Moreover, the individual did not dispute her involvement in the preparation of the fraudulent return.
L.A. Borden, CA-11 (unpublished opinion), 2008-1 USTC ¶50,227, aff'g, per curiam, DC Fla., 2007-1 USTC ¶50,490.
A district court did not abuse its discretion when it admitted an IRS agent's testimony concerning the deductibility of certain expenses and the inaccuracy of some tax returns. The testimony did not improperly render legal conclusions about the facts of the case. Instead, the testimony expressed an opinion regarding the proper tax consequences of a transaction; thus, it was admissible expert evidence.
R.N. Bedford, CA-10, 2008-2 USTC ¶50,511.
Testimony by a client of a return preparer that the preparer had assisted in the preparation of her returns on which false business mileage deductions appeared was sufficient to establish the elements of the crime of willfully preparing false tax returns. The fact that the false deductions appeared on Schedule C, rather than on Schedule A and Form 2106, which were identified in the indictment, had no effect. The indictment also referred to "accompanying schedules" and that language covered the client's Schedule C. Further, the preparer was not entitled to a new trial on the ground that the IRS expert witness's testimony was false. The testimony was correct and, thus, could not have caused any prejudice.
U. Kamalu, CA-4, 2008-2 USTC ¶50,648.
An individual was properly convicted of filing a false income tax return because the evidence was sufficient to find that the individual willfully filed tax returns that he did not believe were true and correct as to every material matter. Since the individual was a successful small business owner who kept careful records and reviewed his tax returns, the jury could reasonably infer that the individual had knowledge of the documents that he signed in furtherance of his stated intent to reduce tax liability.
S.F. Creasia, CA-9, 2008-2 USTC ¶50,666.
An individual who personally prepared amended income tax returns containing false information for her clients was properly convicted of willfully aiding and assisting in the preparation of false and fraudulent income tax returns. Substantial evidence was presented from which a reasonable-minded jury could have found the defendant guilty beyond a reasonable doubt. The government's evidence established that the individual prepared the amended returns reporting inflated deductions, contributions and credits, thereby wrongly entitling her clients to become eligible for additional refunds. The individual's argument that the erroneous amounts were the result of a computer glitch was rejected. The individual had education, training and experience in the preparation of amended tax returns, knew that the deductions were false and willfully provided the inaccurate numbers.
A. Tinder, DC Iowa, 2008-2 USTC ¶50,684.
An individual's conviction on two counts of filing false income tax returns was vacated as to one count, but affirmed as to another. The indictment was insufficient to support the individual's conviction on one count because it alleged that the individual filed a false amended tax return based on the false statements contained in a schedule attached to his original return. However, the schedule, which formed an integral part of the original return, was not an integral part of the amended return. By signing the jurat on the amended return, the individual swore to the veracity of only the amended return. However, the government's evidence supported the individual's conviction on the other count.
J.D. Adams, CA-5, 2009-1 USTC ¶50,241.
The conviction of a pastor for fraudulent evasion of personal income taxes was proper. The government's evidence at trial established that the individual willfully filed tax returns in which he knowingly and significantly under-reported his income.
G.L. Clarke, CA-11, 2009-1 USTC ¶50,295.
The evidence in an individual's trial for failure to file a tax return established that he voluntarily and intentionally violated his tax reporting obligations. He had been repeatedly informed of his tax obligations and the correct method of reporting his income. The admission of transcripts from a previous criminal trial for failure to file returns was not erroneous. Since his defense was that he was unaware of any obligation to report his earnings as income, the government was entitled to introduce the transcripts, which possessed significant probative value, as evidence that he acted willfully and with knowledge of the tax laws and his reporting obligations. Therefore, he was not entitled to a new trial or a judgment of acquittal.
R. Menner, DC Va., 2009-1 USTC ¶50,305.
A couple was properly convicted and sentenced for aiding and abetting the filing of false tax returns. The couple's motion for acquittal was properly denied because the government's evidence was sufficient to sustain the guilty verdict. The trial court did not direct a guilty verdict and properly instructed the jury as to the couple's good faith defense and their reliance on the advice of an attorney, accountant or other tax expert. Third-party tax losses were properly considered at sentencing because the husband's advice to third parties was relevant conduct forming part of a related common scheme or plan. The trial court also did not impermissibly consider hearsay evidence when attributing the third-party tax losses to the individual because the testimony met the required indicia of reliability.
J. Aldridge, CA-8, 2009-1 USTC ¶50,326.
An investment advisor was properly convicted and sentenced for willful tax evasion, subscribing false tax returns, willfully failing to file timely personal income tax returns and pay taxes, and obstructing and impeding the IRS's investigation into his assets. The evidence established that he had a substantial tax debt, his returns falsely claimed entitlement to deduct net operating loss despite being informed of the disallowance of the loss, and he engaged in affirmative acts of evasion by concealing the existence of two corporate entities that were set up to avoid lawful seizure of his assets and establishing stock accounts for his children, into which he redirected his income subsequent to receiving the deficiency notice.
R. Josephberg, CA-2, 2009-1 USTC ¶50,346.
The conviction of a company's president and sole owner for filing false tax returns was upheld because the government established that the owner willfully and knowingly signed the company's tax returns, which contained deductions for payments made to non-existent subcontractors. The government showed that the owner helped create the subcontractors and their invoices and made out checks to the non-existent subcontractors that were cashed every week by the company's superintendent.
R.J. Presbitero, CA-7, 2009-2 USTC ¶50,458.
An individual was properly convicted and sentenced for aiding and assisting in the filing of false tax returns. Admission of testimonial hearsay evidence, which relied on charts and summarizing data of the national tax return statistics, was not an abuse of discretion. The evidence was relevant because it showed that the average charitable contribution on tax returns prepared by the individual and the percentage of such returns that resulted in refunds were much higher than the national average. Further, the individual's personal tax returns were admissible under the public records exception to the hearsay rule.
A.T. Stefani, CA-9, 2009-2 USTC ¶50,474.
A federal district court properly convicted an individual of filing a false tax return. A rational jury could reasonably conclude that the individual knew how much money his law practice made and that he misreported that figure on his returns willfully and with specific intent to violate the law. The individual kept a running log of the financial status of each case; therefore, he was well aware of his law firm's finances. Considering the significant disparity between the income reported by the individual and the actual income earned through his law practice, the jury was entitled to disbelieve his excuse that he relied on his hired assistant and accountant to file accurate returns and signed the returns without reading them.
S.H. Thomas, CA-5, 2009-2 USTC ¶50,510.
An individual convicted of filing false tax returns in violation of Code Sec. 7206(1) was not entitled to a new trial or judgment of acquittal because the government's evidence was sufficient to sustain a guilty verdict. The evidence established that the individual received funds that she did not report as income on her tax returns and that the individual signed her tax return knowing that it did not accurately reflect her income. Testimony that the individual made false representations regarding investments was properly introduced. The evidence was relevant to show that the individual willfully failed to include reportable income on her tax returns and was not shown to be prejudicial.
M. Mendoza, DC Ill., 2009-2 USTC ¶50,547.
An individual was properly convicted of willfully aiding and assisting the preparation of false and fraudulent tax returns. The government established that he actually prepared the fraudulent returns and was aware of their falsity. Documentary evidence, testimony of experts in fingerprint identification and electronically filed tax returns traceable to him were sufficient proof of the individual's willful participation in the preparation of the fraudulent returns. Evidence relating to the IRS's taxpayer audits and the taxpayers' subsequent amended returns and agreed deficiencies was properly admitted. The evidence was relevant and probative of the material falsity of the returns prepared by him, and its admission was not an abuse of discretion.
W. Clark, Jr., CA-5, 2009-2 USTC ¶50,539.
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Labels: Return preparer fraud - Redfiled case