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Miami Tax Law Blog

Florida construction fraud leads to charges

A scheme known as the "Florida Plan" has reportedly diverted up to $1 billion each year from the state's economy as subcontracting companies use the method to escape expensive workers' compensation premiums. This white collar crime occurs as a shell company is established to facilitate opportunities for subcontractors to secure contracts without actually purchasing workers' compensation coverage. A shell company will secure an inexpensive policy that will then be rented along with the company name to a subcontractor. Although the subcontracting organization is able to provide documents that appear to reflect proper coverage, the majority of company employees are not protected.

In a recent case, a man who allegedly set up 10 different shell companies in an eight-year period reportedly collected nearly $75 million through his activities as a subcontractor. He reportedly paid $2,000 per month to another party who carried workers' compensation insurance and rented it to these shell companies. He eventually pleaded guilty to six first-degree felony charges of workers' compensation fraud, assisting investigators in the case.

Florida woman accused of stealing $100,000 from employer

A 39-year-old woman who was employed as a bookkeeper for a Florida business was charged with multiple offenses after she was accused of stealing more than $100,000 from the company. According to the report, the charges resulted from an investigation that was instigated by the owner of the company after he began to suspect that the accused woman was stealing.

The owner reportedly contacted the authorities after the accused woman allegedly told him that she had lost approximately $3,100 of the company's money. However, she offered to pay that amount to the company. When she was reportedly handing the money over, the owner recorded the conversation with her where he accused her of stealing. During the course of that conversation, the woman allegedly admitted that she had been stealing from the company for more than one year.

If I pay taxes late, what penalties will I face?

Florida residents who are unable to file their tax returns on time or who underpay the taxes may be curious as to what type of penalties could be imposed. The final filing deadline is usually April 15, and taxpayers have the ability to request a six-month extension simply by filing a form. The IRS routinely grants extension requests. However, some taxpayers may not be aware that if taxes are not paid in full by the final filing date, interest and penalties accrue even if an extension is granted.

The IRS charges interest on unpaid tax debts, compounded daily. The rate is based on the federal short-term rate plus three percent. In addition, there are IRS penalties for late payments, charged in addition to the interest. For each month the tax debt remains unpaid, the IRS assesses 0.5 percent of the total as a penalty. If the debt remains unpaid long enough for the IRS to issue an intent to levy a person's property, the penalty doubles to one percent for month.

Wire fraud charges filed against Florida woman

On Sept. 2, a Florida woman was arraigned in court after she was indicted on multiple fraud charges. Sources indicate that these charges are related to an alleged scheme involving the creation of false IRS documents.

The Northern Florida U.S. Attorney's Office alleges that the woman, who operated a business that helped truck drivers file registration applications, had engaged in fraud for nearly three years. From June 2011 to Feb. 2014, authorities claim that the woman took a fee from truck driver clients meant to pay their Heavy Highway Vehicle Use Tax to the IRS. Proof of this payment, in the form of an officially stamped document from the IRS, is required in order to register a tractor-trailer in the state of Florida. Prosecutors claim that the woman used a counterfeit stamp to create fake documents and kept the fee given to her by truck owners.

Man accused of defrauding 3 Miami Heat players

According to a report released on Aug. 29, a man was accused of operating a scam that allegedly involved the Miami Heat and a number of investors. According to the report, the accused man claimed that he was from a Pakistani family that was in charge of operating numerous hotels, oil business and textile plants.

Authorities claimed that the man sought to purchase a ticket package from the Miami Heat that was valued at more than $1 million in 2012. He was reportedly given the ticket package in return for the payment at a later date. At the same time, the man started an alleged scheme to invest millions from investors. Three players allegedly became involved as investors after they were promised that they could obtain a significant return very quickly.

Reduced bond for Florida business owners

A couple who is facing multiple charges for their alleged involvement in an organized theft ring received a reduction of $20,000 on their bond after their defense attorneys challenged the amount of money they reportedly earned from selling stolen merchandise online. The pair was taken into custody on Aug. 21 on charges of dealing in stolen property, money laundering and racketeering.

According to official documents, the pair reportedly committed financial fraud by purchasing stolen products and then selling them on an internet auction website. Their bond was reduced to $45,000 from the original bond of $65,000. Officials alleged that some of the proceeds from the sale of stolen goods were used to fund a political campaign for one of the defendants. The couple was taken into custody following an investigation prompted by reports of thefts of large quantities of health care products. Investigators allege that one of the defendants instructed people to steal the items from specific locations around Florida.

3 bankers convicted of fraud

Three men in Florida were sentenced to federal prison on Aug. 21. The charges related to fraudulent activity involving their former employer, Coastal Community Bank. The former CEO and attorney for the bank were each given a four-year sentence in prison. The former Coastal Community Bank CFO was sentenced to three years behind bars. The charges carried a potential maximum sentence of 30 years each as well as five additional years for filing a false claim against the United States.

The three defendants were also ordered to serve three years of supervised release after completing their respective prison sentences. In addition, they required to pay a combined restitution of more than $4.5 million to the Federal Deposit Insurance Corporation. The FDIC, Federal Bureau of Investigation, the Federal Reserve and the Office of the Inspector General all contributed in investigating the scheme undertaken by the three banking executives. All three defendants were convicted of defrauding the federal government.

Florida man pleads guilty to hiding money overseas

Miami-Dade residents may be interested in the story of one Florida man who pleaded guilty to tax evasion charges related to foreign bank accounts. The guilty plea will be followed by the payment of just over half a million dollars in penalties in addition to the payment of back taxes.

U.S. tax law requires that those holding money in a foreign account report any amount over $10,000 as well as any income that comes from overseas. One Swiss bank, UBS, has reportedly helped the U.S. government investigate those who have held money overseas to evade taxes since making a deal with the Justice Department in 2009. They have since agreed to provide the U.S. government with 4,500 U.S. clients' financial data. Dozens of cases of tax evasion have been reported involving foreign accounts since then.

Florida man pleads guilty to government tax fraud

A 34-year-old Florida man pleaded guilty to theft-related charges on Aug. 8. According to the report, the man was accused of having U.S. Treasury checks sent to taxpayers who did not exist as a result of fraudulent tax returns.

The court records stated that the criminal activity occurred between November 2011 and April 2012. The first seven checks were reportedly deposited into the bank account of a co-defendant in November 2011. Another 104 checks were later given to the co-defendant. The co-defendant then wrote a number of checks that totaled over $227,000 and gave them to the defendant and other individuals who were involved in the fraud scam.

Individuals may be wrongly accused of tax fraud

Filing taxes can often be a complicated and exasperating exercise, inspiring many Florida taxpayers to seek outside help. People often turn to a CPA or other certified professional to file their taxes for them. Yet, to the taxpayers' misfortune and surprise, this can sometimes lead to missing documents, falsely completed documents and other problematic issues.

These situations may ultimately elicit legal trouble for the taxpayers if they signed off on the tax forms. It is possible that the IRS may accuse the taxpayers of falsifying tax materials, submitting fraudulent tax documents, making false claims on business returns or intentionally trying to evade their tax responsibilities. As a result, taxpayers may face criminal charges as well as assume debt for the allegedly unpaid taxes.

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