Looming Tax Debt Taints Holiday Cheer
As the Yuletide season grows nearer, more and more people are in a giving
mood. But are you more worried about tax debt and all those dollars the
government wants to collect?
By Stanley H. Block
I remember last Christmas
well. On Dec. 19, a fellow named Jack walked into my office.
He was a big guy,
six-foot-one, 230 pounds, wearing a thick coat below his large cheeks
turned red by the biting cold.
He slapped down on my desk a
copy of IRS Times & Inquirer, a newsletter about people with tax problems
put out by my office. “I can’t take it anymore,” Jack said in his gruff
voice. “Sooner or later, I’ll be one these guys.”
A successful businessman,
Jack had fallen victim to a mixture of bad tax advice and tax-avoidance
scams using offshore bank accounts. He owed the government a whopping sum
— enough to scare a man twice his size. But what scared Jack more than the
tax bill was the prospect of going to jail. He had four kids, two in
college, and one with his first grandchild on the way.
It was no time for Jack to go
to the hoosegow.
I remembered him recently as
I scanned the headlines this month:
-
Judy Knight-Frank, the
60-year-old chair of the Ute Mountain Ute Indian Tribe, received five
months in prison for filing a false income tax return.
-
After ten years of thinking
he’d never be caught, Florida resident William E. Baker received 27
months in prison for failing to file personal income tax returns for the
years 1991, 1992 and 1993.
-
Former Baltimore Police
Commissioner Edward T. Norris, 43, received six months in jail for lying
on tax returns.
-
Inventor John Zentmyer, 62,
was convicted of trying to hide $4 million from the IRS. He faces up to
50 years in prison.
-
Former INS official Jose K.
Livanios, 46, received five months in prison after failing to disclose
farm income on his 1998 return.
These stories of taxpayers
spending the next part of their lives in prison made me think about big ol’
Jack. That was his worst fear: being one of these unlucky folks.
So I called him to see how
his life had change in the past year. We reached an agreement with the IRS
months ago, and Jack was on his way to settling his tax debt.
“You wouldn’t believe it,” he
told me. “I bought a tree last week with my family. I went to the mall
shopping for gifts. I have a new grandchild. Life is great! I’m in the
holiday mood.”
“That’s nothing like it was
last year, is it?” I asked.
“No way! Last year, my whole
family was in the Christmas spirit. But the only thing I could think about
was jail. I was a Scrooge!”
Stanley H. Block is a Maryland State Tax
Attorney and a member of the American Society of IRS Problem Solvers. You
can contact him at 410-727-6006 to obtain a free subscription to his newsletter
titled The IRS Times & Inquirer.
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