Kungu pleaded guilty in November to one count each of aiding and assisting in the preparation of a false income tax return or other document and the willful failure to pay tax, according to a news release the IRS Criminal Investigation.
According to court documents, Kungu since 2009 has been the owner and operator of Tender Care, a home health care business providing 24-hour care for developmentally disabled individuals. As of December 2012, Kungu had not filed an individual income tax return since the 2006 income tax year, and Tender Care had never filed a corporate income tax return.
In January 2013, Kungu hired a tax preparation company to prepare the delinquent returns and to assist in dealing with related income taxes, interest and penalties. However, the company prepared a fraudulent corporate income tax return for 2010 based on false information provided by Kungu, specifically that Tender Care, which earned $19,300, received no income for that year and also claimed a $4,400 rent expense, the release stated.
The income tax preparation company told Kungu he owed $107,392 in total for personal and corporate returns through 2012. At the time, Kongu had $231,433 in personal and business checking accounts. Instead of paying the tax bill, Kungu withdrew $180,500 to buy a gas station, according to the IRS.
“This defendant took steps to come clean with the IRS, but when push came to shove, he chose to skirt his income tax responsibilities and purchase a gas station,” said Ryan L. Korner, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “Now he is a convicted felon and still owes back taxes plus steep penalties and interest.”
Aiding and assisting in the preparation of a false income tax return or other document carries a maximum penalty of three years in prison and a fine of up to $250,000. The willful failure to pay tax carries a maximum penalty of one year in prison and a fine of up to $100,000.
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