Business Owner Indicted on Tax Evasion Charges
Jackson, TN - Isaac H. Brooks, Jr. of Jackson, Tennessee, has been indicted by a grand jury, charged with 29 counts of income tax evasion announced Lawrence J. Laurenzi, United States Attorney for the Western District of Tennessee. Brooks had his initial appearance before U.S. Magistrate Edward G. Bryant today, and he was detained pending his detention hearing set for 1:00 pm on Friday, April 30th, 2010.
According to the indictment, Brooks filed Individual Form 1040 tax returns for 2002 and 2003 that substantially understated his taxable income and tax due and owing to the United States. The indictment alleges that Brooks then failed to file individual income tax returns for 2004 through 2007 with the Internal Revenue Service (IRS) as required by law. During this time Brooks allegedly leased or purchased several new vehicles including two Cadillac Escalades, an Infiniti G35 Coupe, a Mercedes Benz CLS500C, a BMW 745LI, and purchased household furnishings, all in the nominee name of Antioch Missionary Baptist Church. Brooks also concealed his involvement and/or ownership of his business, Temp Owned Temporary Service (TOTS) by having the City of Jackson’s Business Tax Report in his wife’s name. Additionally, the indictment alleges that Brooks provided false and misleading information to an Internal Revenue Service Officer.
The indictment also states that for two quarters in 2003 and for all of 2004 and 2005, Brooks filed false and fraudulent quarterly Form 941, Employer’s Quarterly Federal Tax Return for his business, TOTS. For each of these quarters, Brooks substantially understated the taxable wages paid to employees, federal income tax withholdings, and social security taxes due and owing for each quarter. For all of 2006 and 2007, Brooks failed to file these quarterly employer returns with the IRS as required by law.
Lastly, the indictment alleges that Brooks filed fraudulent Form 940-EZs, Employer’s Annual Federal Unemployment (FUTA) tax returns for TOTS for calendar years 2003 and 2004. The indictment states that Brooks substantially understated the total wages paid to employees for those years, thus understating the FUTA tax due and owing to the United States. Brooks failed to file Forms 940-EZs for 2005 through 2007 with the IRS.
Brooks faces a maximum penalty of 5 years and a fine of $250,000 on each count if convicted.
This investigation was conducted by IRS Criminal Investigation. Assistant U.S. Attorney Leigh Grinalds will represent the government.
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Note: An indictment is a form of accusation and is not evidence of guilt. The defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.