16 May SFS Tax Problem Solutions Newsletter – May 16, 2019
Inside the May edition: Taxman Delivers Cruel Blow to Miss Whiplash, Las Vegas Man Gambles with the IRS and Loses, Just a Single Count of Tax Evasion Could Land You in Prison. Art Dealer Tries to Paint a Different Picture of Her Income, IRS Question & SFS Answer, What folks have to say about us, For the foodies…Yummy Shrimp Pad Thai, A Bit of Tax Humor
May 16, 2019
Inside the May edition:
- Taxman Delivers Cruel Blow to Miss Whiplash
- Las Vegas Man Gambles with the IRS and Loses
- Just a Single Count of Tax Evasion Could Land You in Prison
- Art Dealer Tries to Paint a Different Picture of Her Income
- IRS Question & SFS Answer
- What folks have to say about us
- For the foodies…Yummy Shrimp Pad Thai
- A Bit of Tax Humor
Where in the U. S. is Jeffrey?
In the News!
Taxman Delivers Cruel Blow
to “Miss Whiplash”
May 15, 1990 – Brothel keeper Lindi St Clair, celebrated by Britain’s red-top tabloid newspapers as “Miss Whiplash,” lost her 15-year battle against the taxman on this day. The Inland Revenue demanded back-taxes and brushed aside her argument that they would be living off immoral earnings.
The tax authority said the money was due because it considered prostitution to be a trade, prompting the remark by St Clair that the taxmen were “nothing more than Her Majesty’s pimps.”
Born as Marian June Akin in 1952, at the age of 14 she ran away to London from her country home and was soon working the streets as a prostitute. Carefully taking care of the money she earned, after some time she was able to purchase a large house in the capital, which she converted into a lavish brothel.
Her clients came from the worlds of politics, diplomacy, and business. Such was her success as a madam and dominatrix that she went on to own a Rolls-Royce and a yacht.
St Clair, who appeared regularly on radio and television, was to claim that more than 250 Members of Parliament had been among her clients.
In January 1993, a major police hunt was launched after her car was found abandoned on the south coast. But it was later discovered she had gone on a luxury cruise.
In May of that year, after failing to pay the taxes that the Inland Revenue had demanded in 1990, she was taken to the High Court and declared bankrupt.
After the case, she told reporters: ‘The bankruptcy petition was for £112,000 the Revenue claims I owe, but that is only up to 1983. There is a further 10 years’ unpaid tax they are claiming, bringing the amount up to £250,000.”
“But the Government can whistle up their dispatch boxes for it. I went on that lovely world cruise first-class and blew the lot.”
“They are not getting tuppence out of me. Now all I’ve got left is zilch. I sold my brothel last year. I’ve got no assets.”
“Now I’ve retired. I’ve gone past my sell-by date. I’m going to sign on as unemployed.”
St Clair, who sometimes spelled her name St Claire, stood and failed eleven times to win a seat in Parliament as leader of the Corrective Party. In 2009 she reverted to her birth name and has since embraced Christianity.
Las Vegas Man Gambles
with the IRS and Loses
William Waller Jr., a real estate broker from Las Vegas, NV was convicted in a jury trial of one count of attempting to evade the payment of federal income taxes of more than $500,000 and two counts of failing to file income tax returns.
After filing his 1998 tax return showing zero income, Waller did not file any tax returns for the next 20 years, despite earning $400,000 in 2011 alone. Using a bank account under a fictitious business name, Waller had all commissions earned deposited into that account, which he used to pay personal expenses as well as taking large cash withdrawals. Also, Waller took out loans on real estate that he owned to eliminate any equity he had.
Sentencing is scheduled for June 21st, where he could face five years in prison for the count of tax evasion and one year in prison for each count of failure to file a tax return. Waller also could be sentenced to a period of supervised release, restitution, and monetary penalties.
Just a Single Count of Tax Evasion Could Land You in Prison
Kenneth Wenberg, a medical doctor from Heppner, OR, pled guilty to one count of tax evasion as part of a plea agreement with the court.
According to court documents, Dr. Wenberg created nominee entities to hide assets and income earned as a physician with two separate health care facilities. Dr. Wenberg opened numerous bank accounts in the names of the nominees and instructed his employers to deposit his salaries directly to the sham accounts to avoid income tax liabilities. He also purchased real property in the false entities name and paid personal expenses from their bank accounts.
Wenberg faces a maximum of five years in prison, a fine of $250,000 and three years of supervised release. He has also agreed to pay full restitution to the IRS of approximately $187,000.
Art Dealer Tries to Paint a Different Picture of Her Income
Mary Boone, a prominent art gallery owner in NYC, who was once called “Queen of the Art Scene” by New York magazine, was sentenced to two and a half years in prison on charges of filing false tax returns.
Boone pled guilty to the charges for filing both personal and business false returns. Prosecutors said that Boone had reported fictitious business losses and used over $1.6 million of business funds to pay personal expenses, including $793,003 to remodel her Manhattan apartment, beauty salon purchases of $24,380, $14,00 on Hermés products and $5,000 on items from Louis Vuitton, which she wrote off as business deductions. She also falsely inflated the gallery expenses, and in 2011, transferred $9.5 million from one business bank account to another and reported the account transfers as tax-deductible business expenses by providing falsified check registers to her accountant.
Boone opened her first gallery in 1977, showcasing young and upcoming artists, and as her business and name grew, moved the gallery to Midtown and opened another space in Chelsea.
In 2016, Boone was sued by actor Alec Baldwin, who alleged that Boone knowingly sold him a fake Ross Bleckner painting. That case was settled out of court, with Boone paying Baldwin “a seven-figure sum.”
Question: I’m currently separated from my spouse, who owns his own business, and we are in the process of getting a divorce. I have always filed jointly with my spouse, and now the IRS is sending me notices stating I owe $35,000. I have no idea how they are coming up with this amount as my spouse said he was paying the IRS.
Answer: You may be able to avoid this liability entirely under the IRS’s Innocent Spouse Relief rules. Under federal law, if an income tax return is signed by both husband and wife, both spouses are 100% responsible for the taxes owed. However, the law permits special consideration where a spouse cannot be held responsible for mistakes that are attributable to the other spouse.
If you meet the following criteria you may be able to apply for innocent spouse relief:
Your spouse didn’t report all their income; you were not aware of it and no reason to know about it when you signed the tax return; it would be unfair to hold you liable for the taxes owed due to your spouse’s error.
If you feel you were deceived by your spouse or tricked into signing a return you thought was correct this will help your case too. There are many other ways you may be eligible for relief under the IRS’s innocent spouse rules, and we can help sort this out and determine the proper path for resolution. Don’t pay more than you are legally obligated to.
The Now What Help! Series
Thank you for your kind words
Jeffrey Schneider and his staff have saved our lives. We are now breathing easy and sleeping well. He did a great job for us in regards to our tax issue. Has also helped us to understand the system better and we are on the road to a better future. They are the best!!
Port St Lucie, Fl.
How can I help you?
If you have a state or federal tax problem or just want to refer a friend, relative or client, I’d love to hear from you.
I can provide a no-obligation, confidential consultation to help you solve your IRS problems.
Quick and Super Easy Shrimp Pad Thai
We just love Thai food. Given that I am a pescatarian, and fish can get very tiresome shrimp is my go-to for most recipes that are Asian inspired.
This recipe is so easy and so good. I always up the heat factor as we like very spicy food and I add some Thai Basil, which is grown in my garden as a garnish on top.
Give it a try for a quick dinner.