While there are numerous legal ways to minimize an income tax burden, falsifying returns and committing fraud to try to get out of paying what is lawfully owed will get you into trouble with the IRS, as one Michigan man recently found out.
According to court documents and evidence presented at the trial of a Michigan insurance salesman, the defendant, Donald Stanley LaVigne, failed to report commissions and other income on his IRS tax returns filed from 2013 through 2019—and falsely claimed that the commissions were not income to him. Moreover, in subsequent bankruptcy filings, he did not disclose that the IRS was a creditor on the schedules attached to his bankruptcy although he knew he owed five years’ worth of back taxes, while also understating his income for 2016 and 2017.
Mr. LaVigne compounded his troubles when, upon being notified that he was the target of a federal investigation, falsely claimed that his bankruptcy lawyer reviewed his 2017 income tax return and declared it “complete and accurate.” In turn, the attorney testified that he never advised Mr. LaVigne of the accuracy of the return.
As stated in a Forbes article, the presiding judge for the U.S. District Court for the Eastern District of Michigan found that Mr. LaVigne’s pro se defense was based on “the influence of pseudolegal theories based on invalid and discredited concepts of law and government.” Specifically: “Mr. Lavigne appears to subscribe to the concept that he has two aspects or identities, one which he labels as a “person” or “corporate entity,” and the other as his “flesh and blood’ form. One spells his name with upper case letters. The other adds spurious and meaningless punctuation to his name. Although Mr. Lavigne puts special significance on these alternative nomenclature forms, these are ineffectual in law and are meaningless paper masks. They have no force or meaning in law, other than that they indicate an intention on Mr. Lavigne’s part to evade his lawful obligations and the authority of the Court and other branches of government.
Ultimately, Mr. LaVigne’s odd defense of himself did not work out as he had hoped. He was convicted for filing false returns and making false statements to both the bankruptcy court and the Justice Department’s Tax Division. He was sentenced to 36 months in prison and additionally ordered to two years of supervised release and restitution to the IRS in the amount of $80,732.11.
Mr. LaVigne could have suffered a worse fate as penalties for tax fraud can include a prison sentence of up to five years and a fine of up to $250,000.
If you are concerned about being investigated for possible tax fraud, contact our skilled attorneys immediately
As a prominent tax law group with offices in Chicago and Cleveland, Robert J. Fedor, Esq., LLC is well positioned to help clients defend themselves against allegations of tax evasion and tax fraud. For more information, contact our office online or call us at 800-579-0997.
