WASHINGTON - A federal grand jury in Salt Lake City returned an indictment Wednesday afternoon charging Gerrit Timmerman III, 70, of Midvale, Utah, and Carol Sing, 73, of Henderson, Nev., with one count of conspiracy to defraud the United States. The indictment was announced by Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division and U.S. Attorney for the District of Utah David B. Barlow.
According to the indictment, from April 23, 2004, through March 5, 2007, Timmerman and Sing conspired to defraud the United States by marketing corporations sole as a part of a scheme to evade the assessment and payment of federal income taxes. Timmerman and Sing falsely told their clients that so-called “corporations sole” were exempt from United States income tax laws, had no obligation to file tax returns, and had no obligation to apply for tax exempt status. They further claimed that individuals could render their own income non-taxable by assigning it to the corporation sole, could draw a tax-free stipend from their corporation sole, and could render property immune from Internal Revenue Service (IRS) collection activity by transferring property to the corporation sole. During the life of the conspiracy, Timmerman and Sing were responsible for the creation of approximately 90 corporations sole; at the time their corporation soles were created, these clients had outstanding federal income tax assessments totaling at least $5,000,000.
An indictment is not a finding of guilt. Individuals charged in indictments are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Timmerman and Sing each face a maximum of five years in prison and a fine of up to $250,000.
The case is being investigated by IRS-Criminal Investigation and is being prosecuted by Tax Division Trial Attorneys Michael Romano and Dennis Kihm.