By Alex Zank
A Maryland lawyer pleaded guilty Friday to charges of filing a false tax return and failing to file a different tax return altogether.
George Nelson Smith, 52, of the Smith Law Firm, falsely filed a tax return for tax year 2005 by failing to report income, according to court records. Read the charging document here.
Prosecutors said Smith, who litigated tort actions, claimed W-2 income from his law firm, but did not pay himself that W-2 income. He made expenditures from the firm’s corporate bank accounts that were not reported on the return, according to the government. Smith failed to file a return altogether for tax year 2007 even though, according to the government, he took at least $668,000 from his firm for personal expenses.
“No matter how you disguise your income, one still has to pay taxes on it,” IRS special agent Thomas Kelly said in a written statement. “As an attorney, Mr. Smith is well educated regarding his federal income tax obligations, making his actions even more egregious.”
A lawyer for Smith, Lisa Lunt, an assistant federal defender in Greenbelt, Md., wasn’t immediately reached for comment.
Smith, according to the terms of his plea deal, will be required to pay restitution of $91,547. He also faces a maximum sentence of three years in prison for filing a false return and one year for failing to file a tax return. Sentencing is scheduled for Jan. 28.
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