Wednesday, June 30, 2004

'No taxes' plan ends in prison


Couple set up bogus trusts

By Dan Horn
Enquirer staff writer

A Lebanon couple with ties to a tax protest group is headed to prison on charges of defrauding the government.

Federal prosecutors say Phillip and Joanne Caldwell failed to pay more than $200,000 in taxes from 1993 to 2001 and tried to hide their income through bogus charitable trusts.

Both are accused of working with the Freedom Connection, a tax protest group in Greater Cincinnati that offered advice on how to avoid paying the Internal Revenue Service.

Phillip Caldwell, 48, was sentenced to two years in prison while his wife, Joanne, 41, was sentenced to one year.

U.S. District Judge S. Arthur Spiegel also ordered each to pay more than $100,000 in restitution.

The Caldwells' attorney, Howard Richshafer, said his clients accept responsibility for their actions but had hoped for shorter sentences. He said Phillip Caldwell did not realize he and his wife were breaking the law when he followed the advice of the Freedom Connection and set up the trusts.

"He believed he could do this legitimately," Richshafer said. "Mr. Caldwell attended seminars on trusts and how to avoid paying income taxes. Unfortunately, the promoters of these seminars were not in sync with what the law requires."

Federal prosecutors say the couple hid income in the trusts, used cash to conceal income and attempted to revoke their social security numbers and taxpayer status.

At one point, prosecutors say, Joanne Caldwell claimed she was a foreign citizen and a non-resident alien, even though she lived in Ohio.

IRS officials say tax-protest schemes remain a problem despite dozens of successful prosecutions. Several Greater Cincinnati residents, including some associated with the Freedom Connection, have been convicted in recent years.

"They're still around," said IRS spokesman Craig Casserly. "But we've had a fairly good success rate."

E-mail dhorn@enquirer.com




TOP STORIES
The vigil continues
Little to work on, but Army labors to analyze video
Thousands hold out hope
More health choices, more costs
Health-care services
An hour of sweat, a summer of wet

IN THE TRISTATE
Caseworker fired after mom charged
Region's air exceeding new U.S. limits for soot
Despite projections, CPS votes to count on static enrollment
Illegal drug use up in city, report says
Reform effort rethought
Square's denizens hope for ambience
Event limits eased a bit
Cleanup of lead contamination at Kings finishes one day early
Verity students to use old Lemon-Monroe site
Giving a sucker an even break
Luken calls for riverboat gambling
Mason votes on district
Witness says deputy made meth
Columbus smoking ban stirs activists here
Killer earns IQ hearing
Assault on lawyer results in prison
'No taxes' plan ends in prison
Public safety briefs
News briefs

ENQUIRER COLUMNISTS
Good Things Happening

LIVES REMEMBERED
Ed Eilers was first LaRosa's franchisee
Phyllis Walker, ex-Post reporter

KENTUCKY STORIES
Arrest in motel attack
Kentucky News briefs
For this volunteer, summer is a time to help out others
Engineers named for 9 highway districts
Fires in older homes prompt free detectors
Parades, parades and parades