PROFESSIONAL TAX RESISTER IRWIN SCHIFF AND TWO ASSOCIATES CONVICTED IN LAS VEGAS TAX SCAM

From U.S. Department of Justice

WASHINGTON, D.C. - A federal jury in Las Vegas, Nevada convicted Irwin Schiff and two associates, Cynthia Neun and Lawrence Cohen, of aiding and assisting in the preparation of false income tax returns filed by other taxpayers in connection with a tax scam, and convicted Schiff and Neun of conspiring to defraud the United States, the Department of Justice and the Internal Revenue Service (IRS) announced today. Schiff was convicted on all counts, including income tax evasion and of filing false income tax returns for the years 1997 through 2002, and Neun was convicted of willfully failing to file federal income tax returns, Social Security disability fraud, and theft of government property in connection with Neun’s improper receipt of Social Security disability benefits.

According to the indictment and the evidence introduced at trial, beginning in 1995, the defendants directed thousands of taxpayers to file false federal income tax returns with the IRS that reported zero taxable income in spite of the taxpayers earning large amounts of reportable income. The defendants operated the scam through Freedom Books-a business owned by Schiff-that sold books, tapes, and packets encouraging customers not to pay income tax. According to a government witness who testified at trial, between 1997 and 2002 Freedom Books sold more than $4.2 million in products that promoted Schiff’s “anti-tax” scheme.

“People who evade their tax obligations, or encourage or enable others to do so, are cheating all law-abiding taxpayers,” said Eileen J. O’Connor, Assistant Attorney General for the Justice Department’s Tax Division. “The Department of Justice will prosecute these crimes, and juries will convict the offenders.”

The Justice Department filed a civil suit in the same court against Schiff, Neun, and Cohen in March 2003, and the court granted a temporary restraining order barring them from advertising or selling Schiff’s “zero-income tax return” plan; preparing tax returns for others; and assisting others to violate the tax law, including by “selling services, books or other materials that provide direction about how to fill out fraudulent or false tax forms. . . .” The preliminary injunction was affirmed after the defendants’ appeal to the U.S. Court of Appeals for the Ninth Circuit. The U.S. Supreme Court this month declined to hear Schiff’s challenge to the Ninth Circuit decision. The Justice Department will ask the district court to convert the preliminary injunction into a permanent one. More information about the injunction may be found on the Tax Division website at http://www.usdoj.gov/tax/txdv03357.htm, http://www.usdoj.gov/tax/txdv03357.htm, and http://www.usdoj.gov/tax/txdv03167.htm.

The evidence presented at trial also proved that Schiff evaded the payment of more than $2 million in taxes he owed the IRS from 1979 through 1985. Schiff concealed income he earned from Freedom Books, in part by using offshore bank accounts and conducting financial transactions through secret “warehouse” banking services. The evidence also showed that Schiff used debit cards issued by offshore banks to obtain funds he transferred offshore, that he opened bank accounts using multiple tax identification numbers, and that he titled his ownership of a car in the name of a Pennsylvania corporation.

This marks the third time Schiff has been convicted of tax offenses. “Paying taxes is the price of citizenship. After three strikes, I would hope that even Mr. Schiff realizes that he has struck out,” said IRS Commissioner Mark W. Everson.

Mr. Schiff-who faces a maximum sentence of 43 years in prison and $3.25 million in fines-was remanded to the custody of the U.S. Marshals Service and is scheduled to be sentenced on January 20, 2006 at 10:30 A.M. Ms. Neun-who faces up to 50 years in prison and up to $3.3 million in fines-was remanded pending a bail hearing tomorrow. Neun’s sentencing is scheduled for January 27, 2006 at 9:00 A.M. Mr. Cohen-who was released on bond-is due to be sentenced on January 27, 2006 at 9:30 A.M. He faces three years incarceration and up to a $250,000 fine.

Assistant Attorney General O’Connor thanked Tax Division Trial Attorneys Jeffrey A. Neiman and David J. Ignall, who prosecuted the case, as well as the Special Agents of the IRS, other Tax Division Attorneys, and the U.S. Attorney’s Office for the District of Nevada for their assistance during the investigation and trial of this matter.

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By Dan Richman, Seattlepi.com
 

How to End IRS Problems Forever!

IRS Problems Have a Way of Ruining All Aspects Of Your Life.  They Take A Toll On You Financially, Physically, and Emotionally.  You Can Never Really Forget About Them, As They Always Come Back Each Morning When You Wake Up!

My name is Thomas G. Reed, CPA and I've been an tax accountant for 23 years.  I provide solutions to taxpayers like you who find themselves at odds with the IRS.

Your IRS Problems are unlike many other problems in life, which may in fact go away by themselves.   Unfortunately IRS Problems just continue to get worse and more costly with new penalties and interest being added each day.

 
How does the IRS expect you to pay off 
your taxes if they keep adding penalties. 

I don't know what the IRS thinks, but I do know that they ruin people's lives every day with these ridiculous penalties.  IRS penalties were supposed to be a slap on the hand to make you learn from your mistakes.  But instead, they are used as a hammer to pound you into the ground so far that there are only a few options on how to get out.

What Do They Expect You To Do With 
Federal Tax Liens on Your Credit Report? 

How can you possibly get a loan to pay them off when your banker won't even talk to you?  Federal Tax Liens prevent you from being able to borrow any money for a car or home.

Taxpayers with IRS Problems often have to shop at Buy Here, Pay Here car lots because these car dealers don't care if you have a Federal Tax Lien, because they charge so much for the cars and usually have very high interest rates.

Cars are expensive enough without having to pay 18% to 21% interest on a used car loan, but with a Federal Tax Lien you don't have any choices.

The banks have gotten so tough on opening new bank accounts that anyone with a Federal Tax Lien is usually prevented from even having a simple checking or savings account.

This makes it hard on some taxpayers to cash their paychecks or to pay their monthly bills. Often they have to pay more money and use money orders or certified checks just to pay their rent or utility bills.

Taxpayers With IRS Problems Are Always 
Looking Over Their Shoulder For The IRS! 

Once you owe the IRS money, they become very aggressive in their collection attempts.  One of the more common collection methods the IRS uses is the LEVY!

They will use either a Bank Levy or a Wage Levy.  If you're lucky enough to still have a bank account, the Bank Levy allows the IRS to present your bank with a piece of paper that requires the bank to immediately withdraw all the money you owe the IRS.

Many times these Bank Levies are wrong, but the IRS doesn't care and it's up to you to correct the problem. Meanwhile, the checks you've written are bouncing all over town.

The worst thing about the IRS Bank Levy is that it may capture your children's, parent's, girlfriend's or spouse's bank account, if your name happens to be on the account. Even if it's just on there for convenience.

The IRS doesn't care, they just want to get paid 
and they don't care who pays your taxes. 

After the bank has cleaned out all checking and savings accounts with your name on them, they send the money to the IRS.  You should take this as notice that the IRS will issue another Bank Levy against you in the future to satisfy any remaining amounts owed to them.

It's kind of like hitting the lottery for the IRS.  Once they find out how to get your money, they will continue taking your money by issuing more bank levies.

As Bad as The Bank Levy Is, The Wage 
Levy (Garnishment) Is Much Worse! 

The bank levy is a one shot deal.  Meaning that the IRS must continue to issue a new Bank Levy every time they want to clean out your bank account.  The Wage Levy (Garnishment) is much, much worse.  It's designed to bring you to your knees.

The Wage Levy is issued to your employer and it instructs the employer to immediately start withholding ridiculously high amounts of money to pay old tax liabilities in addition to the normal taxes being withheld.

Wage Levies often result in you only receiving a few hundred dollars per pay period.  This usually makes it impossible to pay your bills and eat.  The IRS knows that Wage Levies cause all types of harm to you and your family, but they mail out thousands every day.

Having IRS Problems Gets Old! 

There can be no real rest and relaxation until your IRS problem is completely solved.  It's hard to keep a good job or get your credit report cleaned up when the IRS continues to issue Federal Tax Liens and Wage Levies.

Without a bank account it's difficult to cash your checks or even pay your monthly utility bills.  Even if you're lucky enough to have a bank account, you have to always worry about the IRS wiping out all of the money in the account without notice.

Some taxpayers with IRS Problems have just a few assets they want to hang on to....

Then The IRS Pulls Out All Of The Stops. They 
Simply Seize Their Assets and Sell Them At An Auction!

Getting the IRS mad enough at you to seize your assets is not that difficult.  Many taxpayers with IRS Problems end up losing everything to the IRS.  For example:

• Autos
• Boats
• Motorcycles
• Real Estate
• Retirement Funds
• Insurance Policies
• Antiques
• Collectibles
• Jewelry

All of these items may be very personal or sentimental in value to the taxpayer.  The IRS could care less.  If the taxpayer won't agree to whatever the IRS wants, then they risk having their assets seized.

Do not underestimate any IRS employee's ability to follow through on the threat of seizure.  Every IRS office in the country has a public list of recently seized assets and details about the upcoming IRS auction to sell those seized assets.

Payroll Taxes Are the Worst!

Many small businesses get in Cash Flow Problems for all kinds of reasons.  How they handle these problems, especially when payroll taxes are involved, usually determines if they stay in business or not.

The IRS takes an extremely strong position on payroll tax violations.  They would rather close the business and sell off all the assets instead of trying to work out a deal with the business.

The worst thing about business payroll taxes is that the IRS has the ability to collect business payroll taxes from anyone they think was responsible for not paying the taxes.  For example, the business owner or any check signer on the business bank account may be singled out for collection activity.

They will try everything to get these payroll taxes.  Usually a visit to your home or work is in order to start the collection procedures.  Then all of the weapons in their arsenal can be used (Liens, Levies, or Seizure) until the taxpayer has agreed to some type of repayment.

Once the IRS has determined that the business cannot pay the payroll taxes and they have turned their sights on the individuals they think are responsible . . . Look Out!

What About Buying A Car or Home?

Driving a new car or an almost new car these days requires you to borrow or lease the car.  That's because they cost so darn much.

Well, without the ability to walk into your local Auto Dealer and cut a deal on a new or almost new car, you're stuck with that old unreliable clunker, just because you have a tax problem.  It doesn't seem fair, but it's hard to get an auto loan or lease when you have an IRS problem.

Home loans are even harder to get.  Heck, they are hard to get when your credit's good if you don't put a pile of money down on the home.  Not having a home to write off causes you to pay even more taxes than your friends or neighbors because you have no tax deductions.

People that do have homes and then get into IRS problems, risk the chance of losing their home to the IRS.  Yes, I mean selling the home and giving the money to the IRS for payment of back taxes or letting the IRS seize it and selling it at auction.
You see. . . .

Having a home before you get into IRS problems may be even worse than not having a home at all.

For example, if you own a home and then find yourself owing the IRS $25,000 for some income or payroll taxes, you could be making house payments on your home that effectively is owned by the IRS.  Once they file a Federal Tax Lien on your home, you can't sell it without paying off the IRS.

This means that you continue making the monthly payments, continue to take care of the home, and the IRS just sits there and waits.  You pay all the bills on your home and they get all the equity.  What a Deal!

Imagine Having the IRS Attack Your Pension, 
Retirement or Social Security Check!

The IRS leaves no stone unturned in it’s never ending quest to collect all taxes, penalties and interest.  Sure, people think the IRS can't or won't levy retirement funds.  They hope that when they get old, the IRS will forget about them and how much they owe the IRS.

Don't believe it, the IRS never forgets!  They just keep adding penalties to what you owe each day until they find you, or your money, or your income source.  Then it's Pay Day for the IRS!

Taxpayers With IRS Problems Never Can
Build Up Retirement Funds or Assets!

You'll always be looking over your shoulder for the IRS.  This usually means you have to work until you die.  You'll have no opportunity to save up for the days when you can't or don't want to work anymore.

There Is No End In Sight!

You just get up every day with this incredible large problem on your shoulders.  You wonder if today's the day when the IRS shows up at work, at home, or if they decide to levy your bank account or paycheck.  It's a large load to bear every day.

Most people around you don't know what you’re going through.  You just keep going, but you know in your heart that doing nothing about your IRS Problems is not going to make them go away.

Are There Ways Out of IRS Problems?

Yes, there are ways to end IRS Problems, but you must decide to end them, no one else can decide for you.  When you decide that enough is enough and you want to have the things that everyone else has and you're really ready to do something about your IRS Problems, there are options available to you!

Our firm specializes in ending the misery of IRS Problems!  There are many possible ways to end these problems, but they all require you to take the first step.

No one can help you until you decide to help yourself.  We are very successful in ending IRS Problems, but the taxpayer must be ready to follow our advice. We can walk you through the IRS maze.

We do all the talking to the IRS.  We also handle all the meetings and correspondences with the IRS.

Our Clients Never Meet With the IRS!

The solutions to solve IRS Problems often include filing old tax returns to get you in current compliance with the IRS.  The IRS will not negotiate with anyone unless they are current with all required filings.  This means all income tax returns and payroll tax returns, if you have employees.

The IRS assumes that if you won't at least get your required tax returns filed, then why waste the time trying to negotiate with you.

It's a rather simple request and we have easy ways to complete old tax returns.  We realize that many taxpayers have lost old records or just can't find them!  We can help you file old tax returns without any records, but you have to take the first step.

Once we have filed all your old tax returns, then the IRS will at least listen.  What we tell them is how you want to end your IRS Nightmare by. . .

Cutting a Deal to Pay Less Then What You Owe!

How much Less?  Well, if you qualify, a lot LESS! The IRS looks at these old tax liabilities and knows it can't collect most of them.  So they have set up this great new program called Offer In Compromise.  This program allows taxpayers to pay substantially less than the full liability to settle up on old income tax and payroll tax liabilities.

When I say Settle Up, I mean completely, 100%!  Once the IRS has accepted the amount you offer and you pay the reduced amount, then the IRS releases all Federal Tax Liens.  Your IRS nightmare is over and you get your life back.

Many Taxpayers Have Been Able To Get
The IRS To Reduce The Penalties.

For Taxpayers who don't file an Offer In Compromise - They request the IRS to Abate the IRS penalties for "Reasonable Cause."  This can be as simple as explaining to the IRS that your basement flooded.

It's a great way to drastically reduce the total amount you owe the IRS, and all it takes is a few letters.

Many taxpayers use our firm to keep the IRS away from them and their families.  Most of our clients Never Meet or Speak With The IRS.  We make the IRS call US, so our clients can go to work and carry on a normal life.

Your IRS problem will not go away by itself.  You only have three choices to end your IRS Nightmare.  You can do one of the following:

• Pay the IRS 100% of what they think you owe today.
   
• Set up a monthly payment which never goes away due to the additional penalties and interest that continue to add up.
   
• Reduce the total amount you owe to an affordable number and get on with the rest of your life!

YOU DECIDE
I can help you explore all the choices and options, but you must take the first step.

You can call for a Free Consultation to discuss your options in confidence.  You have nothing to lose except the peace of mind most people already enjoy.  Why not get some for yourself and your family.

Call my office today at (888) 332-5204  for a Free Consultation.

P.S. Unless you take the first step to solve your IRS problem, it will never go away.  Call Now (888) 332-5204 to take this first step.  What have you got to lose except a few minutes of your time.  Your Free Consultation may give you back the chance to get on with the rest of your life.  Call Now!

P.P.S. The fact that you read this entire report shows me that you’re not like the normal person with IRS Problems. You’re trying to end your IRS Problems.

Call Toll Free Today! (888) 332-5204.  Don’t procrastinate any longer.  Call Now!

READ ABOUT THE IRS SETTLEMENT PROGRAM!

OWE THE IRS? Then stop procrastinating! IRS problems will not go away on their own they just keep getting worse until you take action. If you meet certain criteria you may even qualify to settle your debt with IRS for substantially less than the full amount owed!

WAGES LEVIED, BANK ACCOUNT LEVIED? Most wage levies released within 48 hours, do not let the IRS continue to seize your paycheck, there much better options! Call Toll Free (800) 970-7908.

READ OUR SPECIAL REPORT

We Provide the following services: WAGE LEVY RELEASES, BANK LEVY RELEASES, INSTALLMENT AGREEMENTS, CURRENTLY NOT COLLECTABLE STATUS, OFFER IN COMPROMISE, PENALTY ABATEMENTS, TAX FILING

TAX FRAUD CONVICTIONS ON THE RISE

Three People Sentenced in Tax and Insurance Fraud Scheme

On September 25, 2007, in Boston, Mass, Tina Le, Steven Nguyen and Mercedes Acar were sentenced for failing to report $30 million in cash paid to temporary employees over a 10 year period.  The three defendants received the following prison sentences: Le, 97 months; Nguyen, 87 months; and Le’s daughter, Acar, 70 months.  The defendants pleaded guilty in May 2007, admitting to conspiring to defraud the Internal Revenue Service (IRS), committing mail fraud, and admitting to filing false tax returns.  As part of their sentences, the defendants will forfeit their home, an office building in Dorchester, a warehouse in Brockton, as well as bank accounts, luxury automobiles and expensive jewelry.  The defendants owned and operated a temporary employment agency that employed hundreds of workers who performed manual labor at factories and warehouses.  Under the terms of the agreements with these businesses, the defendants were responsible for filing taxes on behalf of the employees and paying for workers compensation insurance.  The defendants paid most of the employees in cash and did not report the cash payments to the IRS as required by law.  They failed to pay payroll or FICA taxes and failed to withhold taxes from their employees’ pay.  The defendants also defrauded their workers compensation insurers.  The defendants were legally required to pay for their employees’ workers compensation insurance.  Insurance premiums were based in part on the size of the defendants’ payroll, but the defendants reduced their insurance premiums by hiding their cash payroll from the insurers.  The defendants used shell corporations to hide their activities and avoid scrutiny by the IRS and insurance auditors.  As a further way of concealing their activities, the defendants used “straw” corporate officers, individuals who held titles of responsibility in the business but who really were paid by the defendants only for the use of their names.

Owner of Farm Labor Contracting Business Sentenced to 24 Months in Prison

On September 24, 2007, in Fresno, CA, Serafin Rodriguez Mendoza was sentenced to 24 months in prison and ordered to pay $636,876 in restitution.  Mendoza pleaded guilty on July 10, 2007, to conspiracy to willfully failing to make required employment tax payments.  According to court documents, Mendoza admitted that beginning on or about March 1, 1999, and continuing to on or about January 13, 2004, he and his ex-wife, Rosa Lopez Mendoza, owned and operated Central Valley Ag Services (CVAS), a farm labor contracting business located in Delano, CA.  In his capacity as a farm labor contractor, Mendoza withheld employment taxes from farm laborers he hired to work at various farms within in the area, but did not forward these withholdings to the Internal Revenue Service (IRS) as required by law.  Instead, he used the employment tax money to purchase various properties and for personal expenses.  When the IRS began investigating his failure to remit the employment taxes, Mendoza attempted to conceal his interest in, and ownership of, the real properties to avoid liens and seizures by the IRS.  Mendoza placed title and ownership of the properties in nominee names, including the names of his children and acquaintances.

Massachusetts Man Sentenced for Tax Evasion and Filing False Employment Tax Returns

On August 10, 2007, in Boston, MA, Stephen J. Mazzola, of Wakefield, MA, was sentenced to 18 months in prison, to be followed by three years of supervised release and fined $7,500.  He was convicted in June 2006 on four counts of filing false quarterly employment tax returns, tax evasion and obstructing an IRS audit.  Mazzola owned Stoneham Towing and Bodyworks Company.  According to court documents, Mazzola paid employees cash wages “under-the-table” to conceal cash income.  Mazzola also produced false records to obstruct an IRS audit.

Pennsylvania Businessman Sentenced to Prison for Tax Evasion

On August 8, 2007, in Scranton, PA, Thomas Winnicki was sentenced to 18 months in prison and ordered to pay more than $1.05 million in back taxes for employment tax evasion.  Winnicki operated a payroll processing business called Keystone Employee Benefits Inc.  His business customers leased their employees from him and paid over to him employment taxes for those employees.  Instead of forwarding all of the withholding taxes over to the IRS, Winnicki used about $1 million “for personal purposes.”

Oregon Woman to Serve 30 Months in Prison for Tax Evasion

On August 6, 2007, in Oklahoma City, OK, Skoshi Thedford Farr, of Grants Pass, OR, was sentenced to 30 months in prison for tax evasion and ordered to pay restitution of $72,076 to the Internal Revenue Service (IRS) and perform 104 hours of community service.  In February 2007, Farr was convicted of failing to pay employment taxes for her husband’s medical clinic, ATHA-Genesis Chapter, for three quarters in 1999.  Farr’s deceased husband owned and operated an alternative medical clinic in Oklahoma City and she continued to operate the clinic as its administrator until January 2000.  Legally, as the clinic administrator, Farr was personally obligated to pay the employment taxes.  Farr evaded her obligation to pay these taxes by hiding assets and bank accounts from the IRS by placing them in trusts controlled by her adult children.

Nursing Home Owner Sentenced to 30 Months in Prison for Failing to Pay Millions in Payroll Taxes

On July 13, 2007, in San Francisco, CA, Jack Easterday was sentenced to 30 months in prison and ordered to pay $8,710,795 in restitution and a special assessment of $10,700 for his willful failure to pay employment taxes owed to the government.  On March 7, 2007, Easterday was convicted by a federal jury on 107 counts of failing to pay $9.6 million in payroll taxes.  Evidence at trial showed that Easterday, the president of Employee Equity Administration, Inc., and its subsidiaries and Skilled Logic, Inc., willfully failed to pay to the IRS federal taxes withheld from his employees at six nursing homes from 1998 to 2005.  Trial evidence also showed the IRS had attempted to collect the taxes from Easterday for years before the charges were filed.  However, he thwarted the efforts of the IRS to collect the taxes by, among other things, paying himself and his wife exorbitant salaries and directors fees, while he was pleading poverty to the IRS collection agents.

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