Nurse Outduels IRS Over M.B.A. Tuition

A Maryland nurse accomplished two rare feats in her battle with the Internal Revenue Service: She defended herself against the agency's lawyers and won, and she got a ruling that could help tens of thousands of students deduct the cost of an M.B.A. degree on their taxes.

The U.S. Tax Court handed Lori Singleton-Clarke her victory last month, saying the 47-year-old Bryantown, Md., woman had properly deducted nearly $15,000 in business school tuition. The Tax Court ruling should make it easier for many other professionals to deduct the expense of a Master in Business Administration degree.
After getting word of the court decision, "I nearly yelled the roof off the house," Ms. Singleton-Clarke says. "I still can hardly believe it."

The IRS's rules on deducting work-related tuition are complicated and onerous, ultimately preventing most students from deducting their tuition. But this case clarifies the rules and will likely lead to more taxpayers taking the deduction, tax experts say.

Few taxpayers decide to go toe to toe with the IRS as Ms. Singleton-Clarke did, arguing her case without a lawyer. For good reason: In 2009, individuals won only about 10% of about 300 such cases, according to data from Tax Analysts. Ms. Singleton-Clarke fought her case in Tax Court, a venue where taxpayers don't have to pay the contested tax before going to trial. The court has a special procedure for small cases.

Some of the losers, such as several dozen tax protesters who defended the filing of frivolous returns, were tilting at tax windmills. Others were simply on the wrong side of the law, including a horse enthusiast who wanted to deduct his hobby losses, an unsuccessful comedian who tried to classify his expenses as business losses, and an attorney who claimed over $100,000 in medical deductions for his visits to prostitutes.

Of the few who did prevail against the IRS, nearly half came to court on a single issue: requests for "innocent spouse" treatment that decouples a spouse from a partner who is a tax cheat. This provision has been used mostly to protect unknowing wives against their husbands' tax misdeeds. One of the spouses granted relief last year was formerly married to an investment banker who didn't pay his taxes after his bonus didn't come though.

Ms. Singleton-Clarke's encounter with the tax system shows what it can take for one individual to prevail over the IRS against the long odds: favorable facts, obsessive organization, and fearlessness. She says she didn't have a lawyer because she couldn't afford one.


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IRS announces crackdown on fraudulent tax preparers

Internal Revenue Service Commissioner Doug Shulman announced plans today to increase the agency's oversight of paid tax preparers.

For the tax-filing season that's just beginning, the IRS will send letters to about 10,000 preparers whose returns include large volumes of certain types of errors and remind them to be vigilant about areas where mistakes frequently occur. These include the earned income tax credit and the first-time home buyer credit, both of which involve "quite a bit of fraud," Shulman said. Others include Schedule C business income and expenses and itemized deductions.

In the coming weeks, the IRS also will send agents to thousands of preparers on surprise and announced visits. In some cases, agents will identify themselves as IRS employees. In others, they will pose as taxpayers to see what kind of advice they get.

Longer term, the IRS will begin new registration, testing and continuing education requirements for paid preparers.

Today, anyone may prepare a federal tax return for anyone else. The IRS has no testing, licensing or educational requirements. Only a few states -- including California, Oregon and New York -- license or regulate tax preparers. (In California, anyone who prepares income tax returns for a fee and is not a licensed attorney, certified public accountant or IRS enrolled agent must register with the California Tax Education Council, complete an educational requirement on tax laws and obtain a surety bond to protect clients against fraud.)

Many tax preparers are CPAs, enrolled agents or attorneys who must meet educational, ethical and other requirements imposed by their professional or licensing organizations. But many preparers do not have to meet any specific standard when they fill out a tax return for an American taxpayer, Shulman said.

The new IRS initiatives will take several years to fully implement and will not be in effect for the current tax-filing season. They will:

--Require preparers who must sign a federal tax return to register with the IRS and obtain a preparer tax identification number.

--Require competency tests for all paid tax return preparers except attorneys, CPAs and enrolled agents who are active and in good standing with their respective licensing agencies.

--Require continuing professional education for all paid tax return preparers except attorneys, CPAs, enrolled agents and others who are already subject to continuing education requirements.

--Extend ethical rules that currently only apply to attorneys, CPAs and enrolled agents who practice before the IRS to all paid preparers. This will let the IRS discipline or suspend tax preparers who engage in unethical or disreputable conduct.

The IRS will pay for these new initiatives by imposing a user fee on people who are registered and tested.

Shulman reminded taxpayers that they are legally responsible for what goes on their return, even if they hire someone to prepare it. He said most preparers are provide honest, excellent service to their clients.

Consumers should be wary of preparers who claim they can get bigger refunds than others or whose fees are based on a percentage of the refund. They should make sure the preparer will sign the return and give a copy to the client. Also make sure the preparer's firm will be around after the return is filed to answer questions.



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IRS tax relief help for your tax settlement to minimize tax problems

RS TAX FREE LIFE

Avoiding IRS tax debt problems:

Many people just end in pandemonium of receiving the notice of the IRS. The IRS problems do not assume menacing proportions overnight but after repeated notices from the IRS. Some of the prominent ways to avoid the IRS tax debt problems and free tax help from us are as follows:

• One should never take the IRS lightly.
• One needs to respond to the notices of the IRS instead of ignoring them
• One must file the IRS tax returns every year without fail. One should not allow the pending taxes to pile up.
• In the event of you not filing the IRS tax returns, the IRS files substitute for returns wherein you cannot claim some deductions that you are entitled.
• One should take utmost care that all the information furnished at the IRS office is correct, especially your postal address that has to be correct and current in all circumstances.
• It is better to avail the services of a reliable IRS tax debt settlement services company instead of trying to handle the issue personally.


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New Tax Preparer Requirements Have Drawbacks

The Internal Revenue Service proposals for registration, testing and continuing education of tax preparers has won praise from most stakeholders.

The rules, which will take several years to implement, will require all paid tax return preparers that must sign a federal tax return to register with the IRS and obtain a preparer tax identification number. Competency tests will be administered for all paid preparers other than attorneys, CPAs and enrolled agents. The rules also mandate ongoing continuing professional education and extend Circular 230’s ethics rules to all paid preparers.

“It will raise the credibility of the entire profession,” said Amy McAnarney, CPA, executive director of The Tax Institute at H&R Block. “The focus is on those that aren’t regulated today, and that’s the majority of tax preparers out there. We think it is a good thing for preparers, and the system itself.”
In her just-issued annual Report to Congress, National Taxpayer Advocate Nina Olson called the plan a “significant, far-reaching initiative.”

But she noted that one aspect of the plan might open the way for some to exploit and skirt the rules. The IRS plan announced this week would impose requirements on return preparers who sign tax returns but not on preparers who meet with taxpayers and prepare their returns so long as someone else signs them. To minimize the cost and burden, Olson said, an office may decide to employ one “signing” preparer who would be certified under the new rules, and an unlimited number of “nonsigning” preparers.

The nonsigning preparer would not have to register, pass an exam, or take continuing education courses, and the signing preparer would be unable to thoroughly review every return. In fact, Olson noted, the burden of the new rules themselves may cause more return preparation businesses to employ nonsigning preparers. “We are concerned that excluding nonsigning preparers could create an exception that swallows the rules,” she stated. She observed that not all nonsigning preparers need to be covered to protect taxpayers, and recommended that the IRS consider extending the new rules to apply to all unenrolled nonsigning preparers.

“The devil will be in the details. There will be time for these concerns to be addressed as they take the proposal and turn it into regulations,” said Roger Harris, chief executive of Padgett Business Systems. “But it’s a great first step.”

When the rules are fully implemented, the newly regulated preparer who undergoes the registration and ultimate testing process will have “a pretty strong credential,” Harris observed. “A person who is not an attorney, a CPA or an enrolled agent will have to decide which credential will ultimately work best for the preparer and his or her clients.”

Barry Melancon, president of the American Institute of CPAs, also expressed some apprehension about the new credential the rules will create. Although he agreed that the proposal will foster greater compliance with the Tax Code and more reliable service for taxpayers, he noted “concerns about the IRS plan to provide tax preparers who are not already CPAs, enrolled agents or attorneys with a certification based on limited qualifications. A new IRS examination process may cause confusion among taxpayers about the relative qualifications of tax return preparers.”

“It depends on how strict the tests are, how you promote the people that pass it, and how you position them in the marketplace,” said Harris. “Do you tell consumers the registered preparers are at the minimum level of competency, or do you say they’re as qualified as anyone else?

“There has to be a balance between testing for competency without being overly restrictive,” he added. “You want the test to be strong enough so the IRS can say it’s comfortable with the qualifications of those that pass it, but if the test is too difficult, it will negatively affect the industry’s need for tax preparers.”


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IRS Tax Problems -- Special Returns

Most people have employment income (W2) with only a few deductions. These are among the most simple and straightforward income tax filings to do. There are number of people who are self-employed or they have significant amounts of investments and are claiming both unusual income as well as significant deductions against their income. In some cases they IRS will agree with the teturn, while in other cases the IRS will reject the return and decide that you owe additional taxes. If you are not the tax care professional and do not understand all of the new tax laws that are generated every year then you probably will be in better hands if you use a tax relief firm and avoid avoid any problems or miscommunication with the IRS and your potential tax problems. Special returns for such areas as a large income in one-year, the estate returns, sales of investment property and other areas usually require the skills of a tax relief firm who has the resources to help you. These special returns if filed correctly will avoid future IRS tax problems and also avoid penalties and possibly interest that may be assessed for failing to file correctly.

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WAGE GARNISHMENT

Almost nothing is worse than having your wages garnished by an IRS Wage Levy. In the case of a Wage Garnishment, the taxpayer is directed to turn a significant percentage of his or her wages to the IRS. In the event that the IRS files a Wage Garnishment, the taxpayer's employer must intercept a percentage of each of his or her paychecks, and then forward that percentage to the IRS. Wage Garnishments remain in effect until the taxpayer's IRS back taxes are paid in full, or a formal release is negotiated with the IRS. The amount of money that the IRS can withhold is based on a variety of factors, such as whether or not the taxpayer is married, or the number of dependents the person in question has. Up to 90% of your salary can be withheld and sent to the IRS on every paycheck!
PowerTax Relief realizes that reductions in income can be disturbing and destructive to individuals and families. Shortly after garnished taxpayers get in touch with us, we start negotiations with the IRS for a release. In most cases we get wage garnishments lifted on our first contact with the IRS. If not, our tax relief experts will find out what the IRS requires to solve your tax problems and release the wage garnishment. We will work diligently on your behalf until your wages are released. We almost always get wage garnishments released before our client's next paycheck! You can count on PowerTax Relief for both Federal and State tax help.

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TAX SETTLEMENT & AGREEMENT

A tax settlement payment plan with the IRS is formally known as an Installment Agreement. It is possible that the IRS will accept monies for unpaid taxes over the course of up to five years. Sometimes after in-depth financial analysis, our income tax attorney may determine you do not meet the qualifications for an offer in compromise. If so, we consider the next best course of action to resolve your IRS debt problems.
Those individuals who fail to qualify for an IRS Offer in Compromise might be able to receive tax relief through Installment Agreements. If a negotiation with the IRS concludes that one's liquid assets are not sufficient to pay off one's debt, the IRS may opt for an installment approach, instead of a more severe IRS tax garnishment.
We will analyze your ability to pay and contact the IRS to set you up on the best plan for you. Most of the times we arrange for a payment plan with monthly payments substantially less then the IRS' first demands

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IRS DEBT - PENALTY ABATEMENT

Individual IRS debt can escalate with alarming speed. This is because a large portion of the taxpayer's delinquent bills are composed of interest and penalties. Interest and penalties like an IRS lien alone can turn what would ordinarily be a moderate tax challenge into a major ordeal.
The good news is that having past tax penalties like wage garnishment and interest removed (or altogether stopped) is definitely possible. Moreover, if one did not pay penalties and interest correctly, one may qualify for a tax refund.
Pending the fulfillment of specific requirements, the IRS might remove the penalties and interest - either partially or in full. In the event that one can present reasonable cause for failing to pay one's taxes, confirm that no neglect characterized one's attempts to repay the tax debt in question, and verify that due diligence was implemented, the attainment of relief becomes more probable.
If you need tax help, our experts at PowerTax Relief will review your circumstances and determine if you meet the qualifications for penalty abatement. If you do, we will work with you to gather all of the necessary information and documents to put together an abatement package. We will then prepare the paperwork and submit it to the IRS on your behalf.

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As a taxpayer, you have rights...

There is nothing worse than having the Internal Revenue Service or another taxing authority such as the California State Board of Equalization (SBE), the California Franchise Tax Board (FTB), or the California Employment Development Department (EDD) chasing after you. However, as a taxpayer, you have rights, including the right to consult a tax lawyer.
We understand that dealing with a tax problem, whether it is a tax audit by the IRS, a California sales tax audit by the State Board of Equalization or a payroll tax problem with the Employment Development Department, can be a very stressful experience. Therefore, our tax lawyers work not only to minimize the taxes our clients owe, but also to reduce their stress by taking the weight of dealing with the IRS on a day-to-day basis off their shoulders.
There are many excellent California tax attorneys and tax lawyers. Most of those tax attorneys handle tax planning. They can tell you how to most efficiently plan your affairs to lower your taxes, and how to prevent tax problems from occurring. However, relatively few tax lawyers are tax litigation lawyers, or tax controversy lawyers. Tax litigation lawyers represent clients who have tax problems with the IRS or state taxing agencies. For example, if you or your company undergoes a tax audit a tax controversy attorney can represent you at that audit, or in any tax appeal from that tax audit. A tax litigation attorney can represent you in Tax Court, or any other appropriate court which may include the District Court, the Court of Federal Claims, or even the Bankruptcy Court. If you have a tax problem with a California tax agency a tax litigation lawyer can represent you in California Superior Court or before the Employment Development Department, Franchise Tax Board, or State Board of Equalization.
A tax controversy attorney can also represent you if you have a tax collection problem, and would like an offer in compromise or an installment agreement to pay your taxes. In addition a tax controversy attorney can represent you in a wide range of tax problems including the abatement of tax penalties, in summons enforcement actions, wrongful levy actions, and in wrongful disclosure suits. A tax controversy lawyer can represent you if you are a tax professional and become subject to IRS enforcement proceedings such as injunction actions against tax return preparers or an alleged violation of Circular 230. In short if you have a tax problem, a tax litigation attorney can help you.

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Criminal Tax Defense

The following are examples of Internal Revenue Service Criminal Prosecution Investigative proceedings:
Not only does the Internal Revenue Service (IRS) enforce civil tax laws, but it can also impose criminal charges leading to a conviction, fines and imprisonment.
If an IRS Special Agent ever contacts you personally, this may mean that they are conducting a criminal investigation. IRS Agents are known to visit the residences of you, your neighbors, and your place of employment.
If your bank notifies you that the Criminal Investigation Division of the IRS or the U.S. Attorney's Office is requesting copies of your bank records through a summons, there is a high likelihood that you and/or your company are under criminal investigation.
If your accountant is subpoenaed to appear before the Grand Jury and bring your records, a Federal Grand Jury is being utilized to conduct a criminal investigation of you and/or your company. The Grand Jury is gathering evidence at the request of referral of the IRS or other government agency.
If you receive a notice from the IRS that one or more of your previous tax years are being audited AND you know that the returns filed contain either understatements of income or overstatements of deductions, or both, there is a possibility that you will be investigated by the Criminal Division of the IRS.

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IRS Penalties and Interest Add Up Fast

If the IRS thinks that you have underpaid your taxes, they will immediately begin charging penalties and interest to your tax bill, without any investigation into the facts. Those charges can easily exceed the amount of tax they say that you owe… and these penalties and interest continue to add up daily.

There are many cases Tax Attorney Sheppard has handled where the penalties and interest have exceeded 50% of the overall tax bill. In some cases, we have helped our clients reduce or eliminate these charges through a process called abatement. We have also been successful in helping our clients eliminate any of these future charges by successfully negotiating Offers in Compromise.

Typical tax penalties include late filing penalties, late payment penalties, responsible person penalties, payroll tax penalties, sales tax penalties, accuracy-related penalties, civil tax fraud penalties, and substantial understatement penalties.

If these penalties and interest along with your principal tax liability are not satisfied properly, then the IRS can seek to:

• Seize your bank account or your retirement account
• Garnish your wages
• Place a lien on your home or car so you can’t sell it
• In some cases, impose criminal sanctions
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Offer in Compromise

The IRS has the authority to settle or compromise federal tax liabilities by accepting less than full amount under the program of Offer In Compromise. One of the three circumstances must be established in order for the IRS to accept IRS Offer in Compromise and resolve the debt:

1. Inability of the taxpayer to pay off the tax debt in full. This is the most common type of Offer in Compromise (OIC). Under this type of OIC the taxpayer makes a representation that based on the taxpayer's financial condition IRS will not be able to collect the entire tax bill from the taxpayer. The amount of this OIC must reflect the amount of the equity in taxpayer's assets plus the amount that the IRS could collect from taxpayer's future income.
2. Actual presence of tax liability. The taxpayer must prove that the amount of tax or any penalties being billed by the IRS are erroneous. This OIC is generally used if a taxpayer was unable to defend himself against an assessment by the IRS, and has now discovered additional evidence to prove that the amount being billed is wrong.
3. The settlement would promote effective tax administration. This type of offer requires the taxpayer to explain his exceptional circumstances, showing why requiring the payment of the tax liability in full would either create an economic hardship or would be unfair and inequitable.

A successful Offer in Compromise can provide to the taxpayer such significant benefits as:

• The IRS will hold collections while the OIC is being considered;
• Tax liens will be released once the o OIC is completed;
• OIC allows the taxpayer to stay out of bankruptcy, and even reduce taxes that would not have been dischargeable in bankruptcy.

There are also downsides of the Offer in Compromise process. The main negative features of making an OIC are as follows:

• The taxpayer must make a full financial disclosure to the government;
• Certain tax benefits will be waived if OIC is accepted;
• A federal OIC does not resolve state taxes or any other debts.

The acceptance of the IRS Offer in Compromise requires that the taxpayer must remain current on all tax obligations for a period five (5) years. That means the IRS might revoke the OIC, if the taxpayer's OIC is accepted and paid in full, but he later fails to pay current income taxes or other taxes.

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The 10 most important things you need to know about Offers in Compromise

In order to qualify to file an OIC, you must have filed all of the tax returns you are required to file; however, you do not have to make payment on those filed returns. In the case of self-employed individuals, “compliance” means filing and full payment for two consecutive quarters.

The settlement procedures depend on how much is collectible from you. It has nothing to do with how much you owe to the IRS . For example, a $4 million tax liability could be settled for $1,000 if you are only collectible for $1,000.

For collectibility, the IRS looks at both assets and income.

In analyzing income, the IRS is required to allow you to offset your income with reasonable and necessary living expenses (e.g., housing, food, transportation, heath care, court ordered payments, child care, etc.).

The IRS will discount assets to their “quick sale” value. In the case of real estate, cars and other fixed assets, the IRS discount is at least 20% in almost all cases.

If you disagree with an IRS determination by an Offer Specialist, the offer can be appealed to an IRS Office of Appeals. The appeal conference is informal.

If the IRS is actively pursuing a collection action against you (either a levy, lien or garnishment of wages) , you can appeal that collection action in what is called a Collection Due Process Appeal. During that Appeal hearing, you can offer an Offer in Compromise or an Installment Agreement as an alternative to the collection action.

All tax liabilities of individuals and corporations can be compromised, including payroll tax liabilities and tax liabilities for tax fraud, and any tax liability not dischargeable in bankruptcy.

The Congress requires the IRS to have a “liberal acceptance” policy for offers in compromise. The legislative tax policy for offers-in-compromise is to give taxpayers a “fresh start.” The IRS adopts that tax policy.

A tax liability can be settled, even if you are collectible for the full amount of that tax liability, if you can demonstrate “special circumstances” for those assets or income. This can be done if the settlement is important for “effective tax administration."

 

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Md. man sentenced in prisoner tax fraud

A Baltimore man has been sentenced to 25 months in prison for his role in a plot to file fraudulent tax returns on behalf of state prison inmates.

The U.S. Attorney's office says 66-year-old Giacumo Marzano was sentenced Tuesday for his guilty plea to charges of conspiracy to defraud the United States and aggravated identity theft. He was also ordered to pay $200,000 restitution.

Marzano was one of three people who pleaded guilty in the scheme.

Federal authorities say he gave blank federal tax returns to prison inmates, who then returned the completed forms with false information. Marzano submitted the returns to the IRS and received the fraudulent tax refund checks.

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Berryville Man Busted In Alternative Banking Scheme

A Berryville man pleaded guilty to operating a $100 million alternative banking system that allowed members to shield their financial transactions from the Internal Revenue Service.

Wayne A. Hicks, 52, in a negotiated plea agreement with federal prosecutors, pleaded guilty in Fayetteville to conspiracy to defraud the federal government of income taxes.

According to the U.S. Attorney's Office, the alternative banking system, known as ICIS or MYICIS, was created in 2002 for a group called Americans for Lawful Financial Independence and Information. ICIS is an acronym for several names, including Integral Currency Interchange System, Interactive Currency Interface System or Internet Check Issuance System.

The members were involved in the so-called Patriot Movement and were generally anti-government and did not pay federal taxes. Some schemed to overthrow the federal government, according to prosecutors.

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For Medtronic, the IRS comes calling -- late

When Medtronic Inc. arranged to trim its tax bill by licensing intellectual property to a Swiss subsidiary, Bill Clinton was campaigning for his second term as president and "Braveheart" was playing in movie theaters.

Roughly 12 years later, the Internal Revenue Service informed the Minneapolis-based medical-technology maker hat the arrangement was improper -- and that it owes an additional $53.6 million in taxes as a result. Medtronic disputed the claim and started proceedings in U.S. Tax Court, where it has requested a trial in Chicago.

Medtronic's case highlights the tension between companies seeking to deliver increasing profits to shareholders using so-called "transfer pricing," and regulators struggling to rein in a practice blamed for cheating the government of badly needed revenue.

U.S. companies regularly use transfer pricing to reduce their tax burden by shifting intellectual property abroad, in order to avoid relatively high corporate tax rate in this country. As long as the companies license the intellectual property to a foreign subsidiary at a reasonable price, they're likely to pass muster.

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Taxpayer From West Virginia Hires Roni Deutch's Law Firm After Bad Experiences With A Competitor

The Flohrs of Falling Waters, WV found themselves behind on their taxes, and because of excess IRS penalties and fees their total tax liability had added up to an unrealistic amount. Between huge payments to the IRS, and a skyrocketing cost of living, the Flohrs were unable to meet basic living expenses. They had been working
with another tax settlement company for months before calling Ms. Deutch's office and while the other company was able to reduce the total liability, the settlement proposed was not one that Mr. Flohr could afford.

Shortly after contacting Ms. Deutch's office Mr. Flohr decided to retain the law firm for placement on the IRS' Currently Not Collectible (CNC) status, which protects a taxpayer from IRS collections. It demonstrates to the IRS that a taxpayer cannot afford a monthly payment to the IRS, let alone to full pay their back tax liability. This is done by proving to the IRS that a taxpayer's monthly living expenses exceeds his or her gross monthly income and that the taxpayer does not have any valuable assets that could be easily liquidated to pay off the IRS tax debt.

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Tax attorney pleads guilty to failure to file

Prominent Honolulu tax attorney and accountant Michael "Mickey" Rosenthal pleaded guilty yesterday to failure to file a federal income tax return for the year 2000.

The guilty plea to the misdemeanor offense was part of an agreement Rosenthal and his attorney reached with the U.S. attorney's office.

The government agreed not to pursue claims that Rosenthal also failed to file personal tax returns from 2001 through 2005.

He agreed to pay more than $280,000 in back taxes owed.

Federal Magistrate Judge Leslie Kobayashi sentenced Rosenthal to one year of probation, including a six-month stay in a halfway house.

Assistant U.S. attorney Leslie Osborne cited the defendant's education and background in asking Kobayashi to send Rosenthal to jail for up to a year.

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Detroit loan officer jailed for defrauding IRS

A Detroit loan officer has been sentenced to 15 months in prison after pleading guilty to helping others file false Internal Revenue Service claims.

The U.S. Attorney's office in Detroit says 31-year-old Bobby "Sweets" Coward Jr. gave false W-2 forms to taxpayers and conspired with them in 2003 to defraud the IRS of more than $113,000.

Court records show the conspiracy involved federal income tax returns claiming false, fictitious and fraudulent income, tax with holdings and refunds from the IRS.

Prosecutors say very few of the refunds were paid by the IRS.
Coward also will serve two years of supervised release when his sentence ends.

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Ex-attorney indicted for tax fraud

A former partner in a Willows law firm has been indicted by a federal grand jury on charges of tax fraud and evasion.The indictment alleges that Orion Douglas Memmott, 68, submitted false financial statements to the IRS in June 2005. The statements were reportedly in connection with Memmott's attempt to lower his federal tax liability, plus penalties and interest, for the years 1993 through 1999.

The liability was calculated at $656,655.In submitting the statements, Memmott allegedly omitted real property valued at $260,000, and business banking accounts he owned and controlled containing $112,772.He also reportedly failed to report income from diverted investor funds of $116,570.The indictment also alleges that, between 1995 and 2006, Memmott willfully attempted to evade payment of a large part of his federal income tax liability by placing property in the names of others.

If convicted on all charges, Memmott could face several years in prison and a fine of up to $500,000.Several Willows residents recall that Memmott specialized in tax and probate law. He moved from Willows approximately 10 years ago.

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