Authorities can be aggressive in their prosecution of individuals suspected of tax fraud. This includes business owners who are suspected of trying to avoid paying business-related taxes. Recently, a tax evasion case concerning a business owner occurred in Florida.
The case involves a Miami man who is a contractor and a business owner. The man is accused of trying to evade payroll taxes. Allegedly, the man used a scheme involving shell companies to avoid reporting the wages of some of his workers from 2005 to 2007.
The man supposedly would have his company write checks to subcontractors. However, these subcontractors allegedly didn’t do any work for the man’s company. Rather, these checks would reportedly be cashed, and the man would pay his workers with this money. The man allegedly didn’t inform the relevant government tax authorities of these workers or the money paid to them.
The man faced a criminal charge for tax evasion in connection to these allegations. In November, the man pled guilty to this charge. The man was sentenced to serve two years in prison. Also, he will have to make a large restitution payment.
This case illustrates how big of an impact a tax evasion charge can have on a business owner’s life. A business owner can face many consequences if they are convicted of tax evasion. Thus, business owners should be very careful when it comes to the tax matters related to their business. Also, if a person is accused of tax evasion in relation to a business, they should consider seeking advice from a lawyer.
Source: South Florida Business Journal, “Miami contractor sentenced for tax fraud,” 13 Jan 2011