CINCINNATI - Joseph D. Knuckles, age 40, pled guilty here today to one felony count of attempting to evade payment of federal income tax that he owed for 1993 through 1999. Knuckles admitted that he hid his personal and business assets to keep the
IRS from seizing them to satisfy his tax debt for those years.

Gregory G. Lockhart, United States Attorney for the Southern District of Ohio, and Cromwell A. Handy, Special Agent in Charge, Internal Revenue Service Criminal Investigation, Cincinnati, announced the plea entered today.

Since 1985, Knuckles has owned an auto parts brokerage business in Lebanon, Ohio called Core Auto Parts. In 1996 the defendant discharged in bankruptcy $97,492.76 in unpaid tax, interest, and penalty that he and his business owed for 1985-1991, and the IRS released its tax liens against his personal and business property and ceased collection efforts.

When Knuckles accumulated unpaid tax for 1993 through 1999 of $64,104.00, the IRS seized the contents of two of his bank accounts to satisfy part of his tax debt. In order to prevent the IRS from seizing additional assets of himself and his business, the defendant began conducting his business using a personal checking account in the name of his mother and obtained loans for two trucks and titled them in his mother's name as well. Knuckles admitted that during the time he evaded payment of the tax he owed, he spent funds that could have been used to pay his tax debt on investments, vacations, acquiring two new SUVs, and more than $13,000 in purchases on the QVC shopping network.

"For our democracy to function effectively, citizens must comply with their obligations to pay federal income taxes. Those individuals who attempt to avoid this obligation by channeling their assets through other accounts will be prosecuted to the fullest extent. I commend the IRS for their continued dedication to the investigations of these individuals," Lockhart said.

The maximum penalty for evasion of income tax payment is 5 years imprisonment, 3 years supervised release, and a fine the greater of $250,000 or twice the loss or gain, and the cost of prosecution. Sentencing will be set for a later date. Knuckles was released on his promise to appear for sentencing.

For additional comment contact Fred Alverson, Public Affairs Officer at 614.469.5715. The Internet address for the homepage for the United States Attorney's Office for the Southern District of Ohio is www.usdoj.gov/usao/ohs.