In an ironic twist, a former IRS revenue officer was recently sentenced to prison for tax evasion and impeding the due administration of internal revenue laws.
From 1989 to 2014, Mr. Henti Lucian Baird operated a tax preparation and consulting businesses under d/b/a “HL Baird’s Tax Consultants.” Previously Baird had worked as an IRS revenue officer for 12 years. Although he filed his tax returns every year, he failed to pay his taxes since 1998 and used his knowledge and experience as a revenue officer to evade paying taxes.
Here are some of the facts that supported the charges brought in this case:
- Baird hid hundreds of thousands of dollars earned from his consulting business in bank accounts created in the names of his children and used money order and cashier’s checks to pay personal expenses.
- After IRS collections contacted him regarding his back taxes, he submitted a false collections information form (Form 433) in which he claimed to only have one bank account and concealed his nominee accounts. When he learned that the IRS had discovered the accounts and were going to levy the accounts, he withdrew the funds.
- To stall impending liens and levies, he submitted a cash offer in compromise in bad faith
- During the time he failed to pay his taxes, Baird continued to pay the mortgage on his 4,300 square foot home, annual fees for his timeshare in Florida, and car payments for his BMW.
- Baird corruptly used his stepson’s identity, without his knowledge, to apply for a Preparer Tax Identification Number that he used to file over 900 tax returns.
- He advertised himself to clients as specializing in “IRS problems, delinquent returns, offer-in-compromise, tax problems, delinquent employee taxes and release of liens and levies,” and submitted at least 120 power of attorney forms to the IRS on behalf of clients falsely claiming to be an enrolled agent, even though the IRS revoked his authorization to represent taxpayers in 2009.
Sentencing and penalties assessed:
- Baird pleaded guilty to all charges in October 2016.
- He was sentenced to prison for 43 months and ordered to pay $573,422.74 in restitution to the IRS.
One key takeaway from this is the importance of being truthful and honest when filling out a Form 433, Collections Information Statement, to the IRS. Form 433 is generally required by the IRS for any tax debt greater than $50,000. Purposely falsifying the form in an attempt to conceal assets can lead to civil and criminal penalties, and in very egregious cases even jail time.
The second takeaway is to do your research before hiring someone to help resolve your tax debt. Baird was providing tax debt resolution services, when clearly he was clearly unqualified to do so. There are numerous “tax resolution firms” that advertise online, radio, television, and in print. If you’ve been victimized by a “tax resolution firm”, the FTC has a webpage set up for complaints regarding tax relief companies. You can file a complaint here.
Source: DOJ Website