Roger Stone Denies Scheme to Avoid Tax Debt After Russia Probe

Roger Stone and his wife, Nydia Stone, denied attempting to deceive the IRS into a plan to purchase a Florida residence with separate units before stopping payments on a tax liability of approximately $ 2 million.

The rejection came in a lawsuit against the couple, who were alleged to have tried “defrauding the United States” in a government lawsuit filed in April in order to avoid paying their tax debts. In early April, the couple collectively owed nearly $ 1.6 million in taxes, interest and penalties, and Roger Stone separately owed about $ 400,000 plus other interest and surcharges that the government said continued to accrue.

The couple admitted on Monday that they were facing outstanding tax balances, but said they had no knowledge of the specific numbers claimed by the government.

“The Stones were with the IRS upfront about their income, assets and liabilities. You have submitted relevant declarations. And they have consistently shared information with the IRS necessary to evaluate any required payment arrangements and reach an agreement, “the couple told the US District Court for the Southern Florida District.

The government has linked the suspected fraud to legal issues Roger Stone faced in the wake of Robert Mueller’s investigation into Russian interference in the 2016 presidential election. In January 2019, he was charged with obstruction, false testimony and witness manipulation in connection with the investigation and was eventually convicted on all counts.

Shortly after the indictment, the couple set up a trust fund to buy a Florida residence where they later lived with money from a company they controlled, the government said. The government’s lawsuit described this point as evidence that the purchase of the residence by separate companies was part of a fraudulent scheme.

The Stones said Monday that the Mueller investigation and subsequent lawsuit nearly bankrupted Roger, leaving him unable to make payments under an installment agreement with the IRS. They argued the government had ignored the couple’s efforts through their tax advisor to initiate talks about resuming a payment plan.

The couple’s file came the same day Roger Stone was summoned as part of a House of Representatives investigation into the January 6 attack on the Capitol. Former President Donald Trump pardoned him for his conviction in December 2020. The president’s pardon does not extend to civil actions such as the government’s tax liability lawsuit.

Money movements

The couple reportedly evaded government efforts to collect their debt by transferring more than $ 1 million into the company and depositing checks on the company’s accounts for Roger from 2018 to 2019. While they paid more than $ 500,000 from these accounts for their tax debts, they also used the money to fund “a lavish lifestyle,” the government said.

The Stones admitted Monday that Roger had deposited checks on the company’s accounts and transferred money from her personal account to the company’s accounts, but insisted that there was “no nefarious purpose”. They said he used the company for consultancy and other business and that the government had always received all of the information it requested about the company’s finances.

The government wants the court to convict the Stones of the tax debt, state that the residence is owned by the Stones and that pre-existing tax liens on all property – including the residence – owned by the Stones, the company, and the trust are enforceable.

Judge Rodolfo A. Ruiz II reopened the case on November 1 after granting a unanimous request from the Stones for a break.

The case is United States v. Stone, SD Fla., No. 0: 21-cv-60825, answer 11/22/21.

https://news.bloomberglaw.com/daily-tax-report/roger-stone-denies-scheme-to-avoid-tax-debt-after-russia-probe