On March 24th, Jerry Christopher Wade of Hot Springs, Arkansas plead guilty to tax evasion of over $507,000 in federal income taxes. U.S. Attorney David Clay Fowlkes of the Western District of Arkansas made this announcement and it is said that the IRS is currently investigating the case.
What is tax evasion?
Tax evasion is defined as the intentional non-payment, underpayment or concealment of taxes due to the government. This can involve the use of offshore accounts, failing to pay taxes, or filing false tax returns. Tax evasion can lead to large fines, imprisonment, and in some cases, asset forfeiture. It is also important to remember that tax evasion is a federal crime, and prosecutors have the authority to use all available means to enforce the law. Taxpayers who are found guilty of tax evasion could face severe penalties and could even be banned from entering certain countries.
How did he commit tax evasion?
According to the court documents, Wade is the owner of Four Seasons Landscaping in Hot Springs Village and it is his only income. Unfortunately, he did not file his federal income taxes from 2011 to 2019 — 8 years. Despite Wade admitting to federal agents that he knew it was his responsibility to file, he didn’t keep any records. For example, no business records documenting income and expenses. Wade also admitted to not issuing IRS Forms 1099 or W-2 to any of his employees, nor did he keep payroll records.
How much money did he make through the years?
Through the years of Wade’s investigation (2011-2019), his checks received from customers totaled to $2,537,771.86. All of these checks were not deposited into his bank account and instead, he received cash back from the bank which totaled to $878,983.48. Wade was very intentional about making sure that all of his income couldn’t be reported.
What did his plea entail?
According to the press release, Wade admitted he intentionally attempted to evade his income tax responsibilities by taking the following actions: conducting business transactions in cash, paying employees without reporting said payments to the IRS, cashing customer checks at his financial institution, and asking customers to write multiple checks in amounts of less than $10,000 to avoid bank reporting requirements.
What are his consequences?
As a result of prior actions mentioned, in addition to failing to file state income taxes, Wade has agreed to pay penalties and interest. These payments will be made to both the U.S. Treasury and Arkansas Department of Finance and Administration. Also, he faces a maximum of 5 years in federal prison — his sentencing is set to be decided at a later date. The U.S. District Judge says that he will determine his sentence after he’s considered the U.S. Sentencing Guidelines and other statutory factors.
FAQ About Tax Evasion
How can you avoid being accused of it?
First, it’s important to stay up-to-date on changes to the tax laws. Second, make sure to keep accurate records of all your financial transactions and investments throughout the year. This will make it easier to accurately file your taxes and prove that you are in compliance with the law. Third, if you receive income from sources outside of your job, such as investments or rental properties, make sure to declare this income on your taxes. Finally, don’t try to hide or underreport your income in any way – it’s important to be honest and transparent when filing your taxes.
What should you do if you are accused of tax evasion?
If you are accused of tax evasion, remain calm and take the proper steps to ensure that your rights are upheld. First, you should contact a qualified tax attorney as soon as possible. A tax attorney can provide valuable advice about the best course of action for your particular situation. Additionally, they can represent you in any court proceedings and help you negotiate a settlement. Second, make sure that you gather all documents and information related to the accusation. This includes any correspondence with the IRS or other relevant financial statements. Third, understand your rights and responsibilities under the law. You may be able to challenge the accusations if they are invalid or incorrect.
Conclusion
The IRS takes tax evasion seriously, so attempting to get away with it is not a wise decision. Even if you manage to escape the consequences for a few years, they will find out eventually. In order to protect yourself against such accusations, it is best to consult with a tax professional whenever in doubt about how to file your taxes.