branson husband, wife sentenced for tax fraud at branson business, filing false tax returns
SPRINGFIELD, Mo. – Beth Phillips, United States Attorney for the Western District of Missouri, announced today that a Branson, Mo., husband and wife have been sentenced in federal court for corporate tax fraud and filing false tax returns.
Carl Roger Davis, 74, and his wife, Jo Elaine Davis, 60, both of Branson, were sentenced in separate appearances before U.S. District Judge Richard E. Dorr on Monday, Nov. 1, 2010. Carl Davis was sentenced to two years in federal prison without parole and ordered to pay $189,892 in restitution. Jo Davis was sentenced to five years of probation and ordered to pay $10,000 in restitution.
Carl and Jo Davis pleaded guilty on March 31, 2010. Carl Davis was an owner of Bottom Line Employee Services of Missouri, Inc. Employees of Bottom Line worked at the Farmhouse Restaurant in Branson. His son, co-defendant Jeffery Davis, 48, of Branson, was an employee of Bottom Line and the general manager of the Farmhouse Restaurant. Jeffery Davis pleaded guilty and was sentenced on Oct. 23, 2009, to one year and one day in federal prison without parole. The court also ordered Jeffery Davis to pay $62,508 in restitution to the Internal Revenue Service.
Carl Davis admitted that, from 2000 to Jan. 31, 2005, he participated in a conspiracy to defraud the government by impeding the function of the IRS to collect federal employment and income taxes from his employees. During this time, a portion of some Bottom Line employees’ compensation for work at the Farmhouse Restaurant was paid in cash and not reported to the IRS. The understated amount of taxes for the years 2001 through 2004 totals $53,514.
False payroll information, which omitted the cash compensation, was transmitted to a bookkeeper who initially prepared payroll checks and federal employment tax returns for Bottom Line. Carl Davis then filed false Employer’s Quarterly Federal Tax Returns for Bottom Line with the IRS that omitted the cash compensation from total wages, tips and other compensation, and thereby understated the amount of federal employment taxes due from Bottom Line to the United States. Carl Davis pleaded guilty to filing false Employer’s Quarterly Federal Tax Returns.
Carl Davis also admitted that his relevant conduct in this case includes filing false individual income tax returns for 2000 through 2004. The tax loss attributable to these false filings totals more than $130,000.
Jo Davis pleaded guilty to filing a false tax return for 2005. Jo Davis admitted that when she filed her tax return, she omitted $68,664 in compensation that she received from Arbonne International, Inc. Jo Davis also admitted that her relevant conduct in this case includes filing a false individual income tax return in 2004 in which she omitted $6,279 in compensation from Arbonne.
This case was prosecuted by Assistant U.S. Attorney Douglas C. Bunch. It was investigated by IRS-Criminal Investigation.