August 2012

 

Download the Taxing Times August 2012 here.


RAPPER SENTENCED TO TWO YEARS IN PRISON


Beanie Sigel failed to pay taxes for three years on more than $1 million in income.


Beanie Sigel, a rapper from Philadelphia, produced five studio albums and sold more than 2 million records worldwide.

 

Now Sigel, whose real name is  Dwight Grant, will spend two years in prison after pleading guilty to failing to file federal income tax returns.

 

The rapper did not file tax returns from 1999 through 2002, during which he earned more than $1 million and owed $380,459 in taxes.


Prosecutors had asked the judge to sentence Sigel to three years, saying he hasn’t cooperated with the IRS or the Justice Department in efforts to determine his current financial condition.

 

“For all we know, he has earned a significant sum of money and simply squirreled it away, out of the reach of the government,” Assistant U.S. Attorney Paul L. Gray told the judge in a court memorandum. “He would not even cooperate with the probation officer to permit a home visit.”

 

AT 66, FLA. MAN TO SERVE TIME FOR TAX CHARGES

 

A 66-year-old Florida man will serve one year and a day in federal prison after pleading guilty to failing to file income tax returns.

 

Ronald Galan, 66, of Palmetto, Fla., was also ordered to pay $164,829 in restitution to the Internal Revenue Service.


According to court documents, during the years 2005 through 2009, Galan generated income totaling more than $2.7 million. However, despite his significant income, Galan did not file the necessary tax returns for those years and did not pay taxes as a result.

 

A government analysis of Galan’s finances showed he owed approximately $164,829 in taxes for those years.

 

N.Y. CLUB OWNERS GUILTY IN TAX CASE

 

A husband and wife who owned and operated a club in Buffalo, N.Y., pleaded guilty to felony tax violations.

 

Vincent Giamo faces up to five years in prison and a $250,000 fine, while his wife Mary Giamo faces up to three years in prison and a $250,000 fine.

 

The couple owned the club Utopia. Between 2002 and 2005, Vincent Giamo maintained two sets of books for the business. One set of books was used for the preparing and filing of the co­rporate tax returns and the other reflected the true receipts and expenses.

 

Mary Giamo, as an officer of the corporation, aided her husband in filing a false return for the years 2004 and 2005.

 

The total amount of tax loss associated with the evasion is approximately $1.2 million, the government estimated.

 

INTERNET EXECUTIVES HELD BACK MORE THAN $2 MILLION IN TAXES

 

The husband-and-wife executive team of an Internet communications firm used the money for big salaries and to pay for personal expenses.


The owners of a Washington, D.C.-based Internet firm pleaded guilty to charges alleging they failed to pay more than $2 million in employment taxes to the Internal Revenue Service.

Frank G. Bivings and Isabelle Blanco, of Washington, D.C., a husband and wife, ran the Bivings Group, a full-service Internet communications business that provided web-based business solutions for for-profit corporations and nonprofit organizations.

 

Bivings and Blanco admitted that between January 1, 2002, and June 30, 2008, the Bivings Group, Inc. failed to pay to the IRS $2.4 million in employment taxes, which included withholding and FICA taxes. Of this amount, $1.8 million represented the money that was withheld from employees for taxes but was not paid over to the IRS.


Instead of paying the money to the IRS, Bivings and Blanco paid themselves substantial salaries and used corporate funds for personal use.

 

Bivings faced up to five years in prison, and Blanco one year. However, prosecutors agreed to no more than 37 months for each defendant. Bivings and Blanco also agreed to pay $2.4 million in restitution.

 

One of the former employees of Bivings Group acquired the company’s assets following the charges, and has restarted the company under a new name and with other former employees. 

 

CONTRACT NURSE IN ILL. TRIED TO EVADE TAXES


He kept bank balances low and used money orders and cash to evade IRS levies.

 

A contract nurse anesthetist earned hundreds of thousands of dollars from 2004 through 2007, but kept low bank balances and used cash and money orders in an attempt to avoid IRS levies and seizures on his unpaid income taxes.

 

Dale Terry Hedberg, 69, of Breese, Ill., pleaded guilty to four counts of tax evasion and four counts of willful failure to file a tax return.

 

Hedberg also admitted that he filed requests for extensions of the time to file an income tax return in each year in which he falsely estimated his tax liability as zero. This isn’t Hedberg’s first troubles with paying taxes. He was incarcerated in 1999 for willfully failing to file state income tax returns.

 

“Tax cheaters hurt and insult every citizen of southern Illinois who pays his or her legitimate fair share of taxes,” said U.S. Attorney Stephen R. Wigginton in a statement. “No person is above the law.”

 

ALA. WOMAN GETS PRISON TIME FOR FALSE RETURNS

 

An Alabama woman has been sentenced to 21 months in prison for filing false and fraudulent federal income tax returns.

 

Shenita James, 33, of Montgomery, Ala., was also ordered to pay $113,951.


Between 2009 and 2010, James worked at We Finance Auto Sales, where she filed more than 450 tax returns with the IRS claiming more than $2 million in fraudulent refunds. From those fraudulent tax refunds, James received $113,951.