A Frisco man recently faced indictment from a federal grand jury in Sherman, Texas, on charges of tax evasion and corrupt obstruction of the IRS. The allegations revolve around his attempt to evade federal income taxes, utilizing tactics such as the use of an abusive-trust tax shelter.
In September, a federal grand jury in Denver previously charged him with conspiring to defraud the United States by promoting the same abusive-trust tax shelter on a nationwide scale in collaboration with others.
According to the indictment, Frisco resident Larry Conner allegedly failed to remit income taxes reported on his individual income tax returns from 2001 to 2014. Conner allegedly endeavored to obstruct the IRS's collection of the unpaid taxes by establishing fraudulent trusts, concealing over $5 million in income earned between 2016 and 2021, along with other assets, from the IRS.
Conner is accused of endorsing trust documents, establishing five trusts and initiating bank accounts in the name of each trust, which he then utilized to cover personal living expenses. According to the indictment, Conner assigned nearly all of his income to these fictitious trusts and submitted inaccurate individual income tax returns that omitted the income allocated to these trusts.
The indictment also contends that in 2018, Conner submitted a deceptive form to the IRS as part of an offer to settle a portion of his tax liability. Allegedly, on the form, Conner understated his assets, omitted several bank accounts and falsely asserted to the IRS that he was not engaged in business activities.
The previous federal indictment in Denver accused Conner of conspiring to defraud the U.S. by promoting on a national scale the same abusive-trust tax shelter that he purportedly utilized to evade his personal taxes, as outlined in the recent charges. Conner is alleged to have marketed and sold the abusive-trust tax shelter to clients, charging them approximately $25,000 to $50,000 each. Collectively, Conner's promotion and sale of this tax shelter are claimed to have resulted in tens of millions of dollars in unpaid federal income taxes.
Should Conner be found guilty, he could be sentenced to a maximum of five years in prison for each tax evasion charge and three years in prison for the charge of corruptly obstructing the IRS. The ultimate sentencing decision will rest with a federal district court judge, who will take into account the U.S. Sentencing Guidelines and other statutory considerations.