The Chrisley Knows Best Tax Evasion Conviction & Sentencing

The Chrisley Knows Best Tax Evasion Conviction & Sentencing

“Chrisley Knows Best” Tax Evasion Conviction & Sentencing

Recently in the news was the fact that Reality show stars Todd and Julie Chrisley were found guilty of tax evasion. The crime of tax evasion is a very complex tax crime, which unlike other tax violations is a felony. Some tax crimes may qualify as either a misdemeanor or felony “wobbler,” but tax evasion is a felony, which means chances are the Chrisleys may find himself faced with incarceration.  Tax evasion convictions are a bit different than how they are portrayed in the movies. And while tax evasion is one of the more serious types of tax crimes–  in general sentencing and tax crime cases are still limited to 3 to 5 years; noting, that some Defendants may receive less jail time or no jail time at all – while others may receive more than a five-year average. Let’s take a brief walk through the basics of tax evasion convictions and sentencing.

What is Tax Evasion (26 USC 7201)?

      • Any person who willfully attempts in any manner to evade or defeat any tax imposed by this title or the payment thereof shall, in addition to other penalties provided by law, be guilty of a felony and, upon conviction thereof, shall be fined not more than $100,000 ($500,000 in the case of a corporation), or imprisoned not more than 5 years, or both, together with the costs of prosecution.

Tax Crime Allegations Against the Chrisleys

There are many different allegations made against the defendants in this case — with the overall theme being that the Chrisleys intentionally evaded taxes by hiding their money and not reporting the income on the US tax return. The Government alleges that the defendants made false representations in order to obtain loans that they would not otherwise have qualified for if they had been truthful on their loan applications. The complaint further alleged the defendants intentionally avoided using their names on certain accounts in which they owned money and income generated in the accounts. Then, once the government was hot on their trail, they attempted to avoid collection by playing a shell game with the assets, income, and names of the true owners of the accounts and income generated through themselves and their company(s).

Gulity of Tax Evasion and Other Financial Crimes

The case of Julian Todd Chrisley goes beyond tax evasion. The Chrisleys were also found guilty of several other crimes. The crimes included:  

      • False Financial Statements

      • Wire Fraud Conspiracy

      • Filing a False Tax Return

Tax Crime Sentencing

The Chrisleys have not been sentenced yet, and in general, it will depend on what mitigating factors they may be able to bring forth in order to reduce or avoid sentencing to include incarceration — although, with this level of tax evasion and the sheer amount of money at issue (especially during a down market), the government may want to set an example in order to deter other US persons from committing the same types of tax crimes.

As provided by the Department of Justice

Reality TV stars convicted of fraud and tax evasion

      • ATLANTA, Ga. – Following a three-week trial, a federal jury found Todd and Julie Chrisley guilty of conspiring to defraud community banks out of more than $30 million of fraudulent loans. The jury also convicted Todd and Julie Chrisley and their accountant, Peter Tarantino, of a number of tax crimes, including conspiring to defraud the IRS. The Chrisleys were found guilty of tax evasion, and Peter Tarantino was found guilty of filing two false corporate tax returns on behalf of the Chrisleys’ company. The jury also found Julie Chrisley guilty of wire fraud and obstruction of justice. 

      • “The jury found that Todd and Julie Chrisley committed multiple fraud schemes for several years and their accountant, Peter Tarantino, filed false corporate tax returns on their behalf,” said U.S. Attorney Ryan K. Buchanan.  “This office and our partner agencies will continue to vigorously investigate and prosecute white collar criminals who flout the law.”

      • “As today’s outcome shows, when you lie, cheat and steal, justice is blind as to your fame, your fortune, and your position,” said Keri Farley, Special Agent in Charge of FBI Atlanta. “In the end, when driven by greed, the verdict of guilty on all counts for these three defendants proves once again that financial crimes do not pay.”

      • “Todd Chrisley, Julie Chrisley and their Certified Public Accountant, Peter Tarantino, conspired to evade the assessment and payment of the Chrisley’s income taxes.  The Chrisleys and Tarantino knew the law was clear on taxable income and who is required to file and pay taxes,” said James E. Dorsey, Special Agent in Charge, IRS-Criminal Investigation. “These convictions should send a clear message regardless of your fame or notoriety, everyone will be held accountable for paying their fair share of taxes.”

      • According to U.S. Attorney Buchanan, the charges and other information presented in court: Before Todd and Julie Chrisley became reality television stars, they conspired to defraud community banks in the Atlanta area to obtain more than $30 million in personal loans. The Chrisleys, with the help of their former business partner, submitted false bank statements, audit reports, and personal financial statements to banks to obtain the millions of dollars in fraudulent loans. The Chrisleys then spent the money on luxury cars, designer clothes, real estate, and travel—and used new fraudulent loans to pay back old ones.  After spending all the money, Todd Chrisley filed for bankruptcy and walked away from more than $20 million of the fraudulently obtained loans.  

      • The evidence further showed that in 2014, while Todd Chrisley was in bankruptcy proceedings, Julie Chrisley again manufactured financial documents and lied to real estate agents to obtain a luxury rental house in Los Angeles, California.  As soon as the Chrisleys began renting the house, they failed to pay rent, and the homeowner filed an eviction lawsuit.

      • Around the time that Todd Chrisley filed for bankruptcy, the Chrisleys became the stars of their own reality show, which was recorded in Atlanta and later in Nashville.  The evidence at trial showed that while they were earning millions from their TV show, Todd and Julie Chrisley, along with their accountant, Peter Tarantino, conspired to defraud the Internal Revenue Service.

      • Throughout the conspiracy, the Chrisleys operated a loan-out company that received their income earned from their show and other entertainment ventures. To evade collection of half a million dollars in delinquent taxes owed by Todd Chrisley, the Chrisleys opened and kept the corporate bank accounts only in Julie Chrisley’s name. One day after the IRS requested information about bank accounts in Julie Chrisley’s name, the Chrisleys transferred ownership of the corporate bank account to Todd Chrisley’s mother in an effort to further hide his income from the IRS.  All the while, Todd Chrisley operated the loan-out company behind the scenes and controlled the company’s purse strings.

      • While the Chrisleys were earning millions and evading paying Todd Chrisley’s delinquent back taxes, they also failed to file tax returns or pay any taxes for the 2013, 2014, 2015, and 2016 tax years. At one point, Todd Chrisley falsely claimed on a radio program that he paid $750,000 to $1 million in federal income taxes every year, even though he had not filed or paid his personal income tax returns for years. Tarantino was also convicted of filing two false corporate tax returns for the loan-out company, which falsely claimed that the company earned no money and made no distributions in 2015 and 2016. 

      • Finally, Julie Chrisley was convicted of obstruction of justice. After learning of the grand jury investigation, she submitted a fraudulent document in response to a grand jury subpoena to make it appear that the Chrisleys had not lied to the bank when they transferred ownership of the loan-out company’s bank account to Todd Chrisley’s mother. Julie Chrisley transmitted this document with the intent of impeding the grand jury’s investigation into her and her husband and avoiding prosecution.

      • Sentencing for Todd and Julie Chrisley, and Peter Tarantino, has been scheduled for Thursday, October 6, 2022, at 9:30 a.m.

      • This case is being investigated by the FBI and IRS Criminal Investigation. 

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