A former San Martin couple already facing a $1 million fine for
tax evasion pleaded guilty to filing a false tax return in 1994,
ducking more than $50,000 in taxes, according to the Department of
Justice.
Gilroy – A former San Martin couple already facing a $1 million fine for tax evasion pleaded guilty to filing a false tax return in 1994, ducking more than $50,000 in taxes, according to the Department of Justice.
Michael Watts, 60, and Jan Watts, 54, pleaded guilty Monday to income tax evasion in 2004, a decade after the Watts omitted $92,494.13 in income from Melbourne Enterprises, Michael Watts’ consulting company, and $90,000 in payments to Fundamental Technologies Inc., an off-shore company that Jan Watts established in the West Indies. By leaving the income off their returns, the couple paid no taxes in 1994 and actually got a refund, bilking the IRS of $54,183.
Monday, the couple pleaded guilty to the additional charge of filing a false tax return, after authorities filed additional information last Tuesday.
The Watts have agreed to repay $1 million to the IRS, and could face additional penalties when they appear before Judge Ronald Whyte in San Jose for sentencing Aug. 27. The maximum penalty for filing a false tax return is three years in prison and a $250,000 fine, plus restitution.
The plea follows a lengthy investigation by the IRS, and was prosecuted by Assistant U.S. Attorney Jeff Nedrow with the help of Susan Kreider.
