Utah Man Shoots Himself in the Foot by Not Reporting Illegal Firearms Sales

Adam Michael Webber from Salt Lake City, UT was sentenced to 4 years in prison for dealing firearms without a license and filing fraudulent tax returns.

Webber was the sole owner of HK Parts, an internet gun parts business from 2007-2008.  Although Webber did not have a license to sell firearms, he added them to his website and also sold them out of the basement of his residence. From 2009 to 2012, Webber also sold firearms through another company owned by another entity.  Webber was caught by ATF agents after he sold weapons to undercover agents, once in a parking lot for cash.

Webber earned more than $10 million from 2007 through 2010 and only reported an income of $183,397 for those years on his individual tax returns.  In 2010, Webber purchased a new home in cash for $670,000.

During a search of Webber’s home in 2012, agents found $180,000 in cash, a 70lb silver bar, silver coins and 300 firearms.

In addition to jail time, Webber will serve three years supervised release, $100,000 fine and previously paid restitution to the IRS in the amount of $1,817,887.

Neither Snow nor Rain nor Gloom of Night Stopped this Postal Carrier from his Tax Scheme

After being convicted by a jury in September, 2017, Harold Coley of Columbus, GA was sentenced in December, 2017 to 97 months in prison for conspiring to file fraudulent refund claims, mail fraud and embezzlement of mail.

Coley worked as a mail carrier for the U.S. Postal Service to a route in Columbus. During his trial, evidence showed that Coley was recruited by co-conspirator Keisha Lanier to participate in the stolen identity tax refund scheme.  While on his route, Coley would compile a list of addresses of vacant buildings or addresses that did not exist and turn over the information to Lanier.  Lanier would then obtain stolen identities from a third co-conspirator, Tamika Floyd, who worked for the Alabama Department of Public Health.  Most of these stolen identities belonged to 16-17 year olds.

Lanier would then file fraudulent tax returns directing the IRS to mail the refund checks to the false addresses provided by Coley. The IRS issued over 1,600 refund checks totaling more than $2.5 million.

In addition to jail time, Coley is ordered to serve three years supervised release and to pay $901,351 in restitution to the IRS.

Co-conspirators Lanier and Floyd were previously convicted and sentenced to prison in 2015.

PA529 Savings Plan

As part of America Saves Week, February 26 through March 2, the PA 529 College Savings Program is partnering with financial experts to offer five free webinars. Topics for the interactive sessions include how to keep your savings safe, understanding your credit score, and how to prepare for retirement.

In addition to these five webinars, we have our regularly scheduled webinars on PA529.com to learn more about the PA 529 College Savings Program, a tax-smart way to save for higher education.

The webinar schedule is below, and session descriptions and registration information are available at PA529.com.

Interesting World Tax Exemptions

World Cup Tax Exemption

Before any country can host the Word Cup for soccer, FIFA demands “a comprehensive tax exemption to be given to FIFA”, including freedom from corporate tax, income tax, VAT and any other taxes the laws might require.

 

Artist Exemption— Ireland

If you’re an artist in Ireland, earning your income through books, writing, plays, musical compositions, painting or sculptures, and the Arts Council determines the work is original and creative having cultural or artistic merit, they can grant an exemption of income up to €50,000 from income tax.

 

Cereal Toy Tax — Canada

Makers of children’s breakfast cereal in Canada are granted tax-free exempt status if their cereals contain free toys.  The exemption is limited to toys that are not “beer, liquor or wine.”

 

British Culture Film Tax Break

Britain offers tax deductions to films it considers “culturally British”. Based on a “culture scoring test”, the film must pass with a score of 16 out of 31 points to receive a tax break of 25%.

The IRS Digs up Dirt on Excavating Business Owner

Michael Collins, of McClelland, IA pled guilty in Federal Court to charges of tax evasion in December, 2017.

From 2006 to the present, Collins owned and operated an excavating and trucking company earning over $5.5 million in gross receipts.  In order to avoid paying taxes, Collins registered the business and bank accounts in the names of nominees.  He filed fraudulent corporate returns which listed the nominees as the owners of his business, and instead of paying taxes, he used the money for personal expenses.  The fraudulent returns claimed that the business had no gross income and his only source of income was from unemployment benefits.

In 2006 Collins was also part owner of a real estate development company, and earned over $289,000 but didn’t report the income on his individual tax returns.  The IRS contacted Collins about the unreported income and Collins filed an amended tax return showing he owed the IRS more than $100,000, and did not pay the IRS.

 

Collins will be sentenced in May, 2018 and faces up to five years in prison, supervised release, restitution and monetary penalties.

Business Owner Fails to Pay Employment Taxes

Steve Lopez, owner of two businesses in West Virginia, pled guilty in Federal Court to charges of failing to pay employment taxes.

From 2008 to 2012, Lopez owned Ready Transport Services, a taxi service company as well as RTS Ice Cream, Coffee and Candy Shop.  Although Lopez withheld social security, Medicare and income taxes from his employee’s paychecks, he failed to pay approximately $393,851 in taxes owed to the IRS, as well as his employer’s share of those taxes.

Lopez is scheduled to be sentenced in March 2018.  He faces a maximum sentence of 5 years plus supervised release, restitution and monetary penalties.

Tax Identity Theft Isn’t Limited to Individual Returns

The Internal Revenue Service issued a bulletin in December 2017 warning small businesses to be vigilant against a growing number of tax identity thefts against employers.

It was noted that the IRS saw a large increase in the number of fraudulent forms 1120, 1120S and 1041 as well as Schedules K-1, as well as partnership, estate and trust returns.

In the past, identity thieves were using stolen Employer Identification Numbers (EINs) to create fake W-2 forms that they use to when filing false individual returns and using the EINs to open lines of credit or obtain credit cards.  Now they are using company names and EINs to file fraudulent business returns.

To help combat the thieves, starting in 2018, the IRS is now asking business and tax practitioners to provide additional information such as:

  • Name and SSN of the person authorized to sign the corporate return;
  • Payment history of estimated tax payments, how they were made, and the amount paid;
  • To list if there is a parent company and the name;
  • Give additional information based on the deductions claimed; and
  • Business filing history — listing any other business related tax forms filed.

Your IRS Questions Answered Here…

Question: I was self-employed and haven’t been able to pay my taxes for 3 years.  Now I’m a W-2 employee but I’m getting letters from the IRS demanding payment and threatening to garnish my paycheck. What should I do?

Answer:  The IRS doesn’t like being ignored and they want you to know they won’t go away. They have a lot of power over your life. They have 10 years to collect from the date you filed your return. Not only can they freeze your bank accounts and take the money, but they can garnish your wages and legally take as much as 75% of your net paycheck, without a court order!  The IRS can and will slap a lien on your house and other property as well. If you sell your house the IRS gets their money first before you do. Federal Tax Liens will damage your credit, making it harder to rent an apartment, get a car, obtain credit, and even get a job.  The IRS can even show up at your door!  Interest and penalties continue to accrue on a daily basis. You need professional expert help to deal with the IRS!  You can’t do this on your own. We offer immediate relief by protecting you from the long arm of the IRS. This is what we do on a daily basis. Don’t let the IRS take what you worked so hard for to earn.

Funny Tax Quotes

“The only difference between a tax man and a taxidermist is that the taxidermist leaves the skin.”

-Mark Twain

 

“I am proud to be paying taxes in the United States.  The only thing is I could be just as proud for half the money.”

-Arthur Godfrey

 

“Income tax returns are the most imaginative fiction being written today.”

-Herman Wouk

 

“America is a land of taxation that was founded to avoid taxation.”

-Dr. Laurence J. Peter

 

“The income tax has made more liars out of the American people than golf has.”

-Will Rogers

 

“I just filled out my income tax forms.  Who says you can’t get killed by a blank?”

-Milton Berle

 

“The best measure of a man’s honesty isn’t his income tax return.  It’s the zero adjust on his bathroom scale.”

-Arthur C. Clarke

 

“An income tax form is like a laundry list — either way you lose your shirt.”

-Fred Allen

 

Fortunes Have Been Made From Cryptocurrency and the IRS Wants it’s Share

If you invested $1,000 in Bitcoin back 2010, your investment would be worth roughly $35 million today.

The IRS took notice that the number of tax returns showing gains from virtual currency were not in line with the number of investors. On November 29, 2017, the IRS ordered one of the largest websites for trading digital currency, Coinbase, to turn over identifying information for anyone who bought, sold or sent $20,000 or more to the IRS, including taxpayer ID number, name, date of birth, addresses, transaction logs and account statements. Initially, the IRS requested the records of every Coinbase account but a California federal judge found that “unnecessarily comprehensive”.

Coinbase has over 6 million users and fewer than 1,000 taxpayers reported gains on their returns. The decision will affect over 14,355 Coinbase account holders.