The guilty pleas of a Carson City accountant and his wife, a Reno accountant, to tax charges come as the Internal Revenue Service continues its investigation of tax schemes that involve creation of offshore companies.
Roger Steele of Carson City pleaded guilty to preparing a false individual income tax return, and his wife,Kimberly Steele, a Reno, accountant, pleaded guilty to attempting to obstruct an IRS audit.
They each face a maximum penalty of three years in prison and a $250,000 fine.
U.S.
District Judge Larry R.Hicks scheduled sentencing for Roger Steele on Dec.
29 for Kimberly Steele on March 16.
Roger Steele, owner of Steele Accountancy Inc., pleaded guilty in connection with the advice he gave a client,Dale Brown, regarding Brown's 1998 individual and corporate income tax returns.
Kimberly Steele pleaded guilty, prosecutors said, for obstructing the IRS while she represented representing Brown during an audit by the IRS in 1999.
Brown, an author from Incline Village, pleaded guilty in April 2004 to filing a false 1998 corporate tax return on which he falsely claimed more than $450,000 in bogus business expenses as a result of his participation in an offshore scheme promoted by Roger Steele.
According to court documents,Roger Steele assisted Brown in forming two offshore corporations in 1998 and 1999.
He advised Brown to transfer money from his domestic corporation to the offshore corporations and to record bogus expenses on the domestic corporation's records.
The Carson City accountant also advised Brown that he could bring the monies transferred to the offshore corporations back into the country disguised as loans or by using a credit card issued by an offshore bank.
Steele, prosecutors said, admitted he prepared a false corporate return for Brown that showed fraudulent business deductions of more than $450,000, and a false 1998 individual income tax return for Brown that understated Brown's income tax liability by approximately $223,000.
Kimberly Steele admitted that during an IRS 1999 audit, she assisted Brown in presenting to the IRS auditor a false explanation about Brown's use of an offshore credit card.
To support the fictitious explanation, she gave to the IRS auditor a false affidavit, according to court documents.
Mercedes Manzur, a special agent for the IRS criminal investigation unit in Nevada, said last week that the agency has developed a nationally coordinated effort that targets tax schemes that use limited liability corporations, trusts or entities to evade taxes.
In fiscal 2004, the last year for which statistics are available, 82 indictments were handed up nationwide in abusive tax schemes, the agency said.
Along with taxpayers who use the schemes, accountants, attorneys and other advisors are targeted by the IRS investigation.
Commonly, the IRS says, taxpayers create multiple layers of offshore entities, usually in hopes of creating the appearance that the taxpayer no longer is in control of his assets.
Other frauds involve creation of false billing schemes in which a taxpayer reduces his taxable income by paying invoices generated by a offshore company that he owns.
