Logan County, Kentucky Businessman Charged With Failing To Pay Income Taxes For 15 Year Period
– Diverted income to “shell” companies to hide assets and employees from the Internal Revenue Service
BOWLING GREEN, Ky – The Owner and operator of a construction business that performed work on commercial poultry houses was indicted by a federal grand jury meeting in Bowling Green, Kentucky, on February 13, 2013, and was unsealed today, charging him with one count of personal income tax evasion, ten counts of employment tax evasion, and four counts of failure to report income tax announced David J. Hale, Untied States Attorney for the Western District of Kentucky.
According to the indictment, Norman Hostetler, age 41, of Russellville, Kentucky beginning on or about January 1, 1996, and continuing up and until at least June 6, 2011, in Logan County, Kentucky, and elsewhere, did willfully attempt to evade and defeat the payment of a large part of the income taxes owed by him to the United States of America. Hostetler concealed his income by, among other things, failing to file individual income tax returns with the Internal Revenue Service (IRS) for the calendar years 1996 through 2011.
Between 1998 through 2009, it is alleged by the indictment that Hostetler created and operated Stanley and Sons (S&S) Trust, in Orange County, California, to create and reinforce the false impression that it was a valid trust to be used for estate planning purposes. Hostetler also created and used a bank account for S&S as a “formal trust” designed to conceal and mislead the IRS as to the true nature of the account. Further, between 1998 and through 2009, Hostetler disguised and attempted to disguise a substantial amount of income, earnings, and assets from the IRS that he owned and personally controlled by diverting assets and income to entities, including (S&S) and Green River Enterprises.
Between March 2009 and June 2011, Hostetler used multiple shell companies to disguise his ownership of vehicles from the IRS. Eco-Trans, LLC and Smokey Mountain Management Business were allegedly set up by Hostetler to obscure the chain of ownership of vehicles purchased by the defendant between March 2009 and June 2011.
Hostetler is further charged with concealing his business, employees, and employee payroll from the IRS by not paying employment taxes to the IRS and by failing to file employment tax returns (Form 941) on behalf of his employees from January 2007 through July 31, 2009. Form 941 is used to report an employer's withholding of employees’ federal taxes from their employees’ compensation, including Social Security tax, income tax, and Medicare tax.
If convicted at trial, Hostetler faces 59 years in prison, a fine of ¬$3,150,000, and 3 years’ supervised release.
This case is being prosecuted by Assistant United States Attorney Joshua Judd and is being investigated by IRS Criminal Investigation Division. If you have any information as to the location of Norman Hostetler please contact the IRS Criminal Investigative Division at 270-901-3048.
The indictment of a person by a Grand Jury is an accusation
only and that person is presumed innocent until and unless