On Monday, The owner of Custom Design and Carpentry, LLC admitted to evading more than $100,000 in tax payments by depositing business checks into his personal accounts and failing to report that income, U.S. Attorney Paul J. Fishman announced.
Sing Chan, 32, pleaded guilty to one count of subscribing to false personal federal income tax returns. Chan entered his guilty plea before U.S. Magistrate Judge Patty Shwartz in Newark federal court.
Chan is the owner of Custom Design and Carpentry, a construction and remodeling business. During 2008 and 2009, Chan sometimes received payment for services through checks made payable to Custom Design, and sometimes checks were made out to Chan directly.
The checks made payable to Custom Design were deposited into Chan’s business bank account. The checks made payable to Chan were deposited into Chan’s personal bank accounts at various banks, though the memo portions typically contained a note referencing construction and remodeling work he performed.
Chan admitted that for tax years 2008 and 2009, he filed U.S. Individual Income Tax Returns in which he purported to report all of his income from Custom Design, but failed to report the income that he deposited into his personal bank accounts – approximately $410,856. The amount represents approximately $258,646 in 2008, and approximately $152,210 in 2009. Chan’s intentional failure to disclose the income to the IRS caused a tax loss to the United States of approximately $100,406 – including approximately $58,170 in 2008 and $42,236 in 2009.
As part of his guilty plea, Chan has agreed to make full restitution for all losses resulting from his filing of false tax returns, including approximately $100,406, plus interest and penalties to be determined, to the IRS.
The charge of subscribing to false tax returns carries a maximum potential penalty of three years in prison and a $250,000 fine. Sentencing is currently scheduled for Sept. 26, 2012,