A former Michigan theater manager has blown the whistle on his boss’s tax fraud. The whistleblower collected documents covering an eight year period to prove that cinema owner Elaine Dawson has defrauded the Internal Revenue Service (IRS). The documents allegedly prove that Ms. Dawson failed to report all of her income from her five North Michigan movie theaters.
Cinema Owner Defrauded IRS of Nearly $1 Million by Underreporting Ticket Sales
Ms. Dawson allegedly evaded paying her full tax debt by regularly underreporting ticket sales and pocketing cash from the cinemas. Ms. Dawson allegedly defrauded the IRS of almost $1 million. According to the whistleblower, Ms. Dawson habitually paid cash for everything from houses to cars.
According to UpNorthLive.com, Ms. Dawson intends to plead guilty to charges of tax evasion. The future of Ms. Dawson’s cinemas is uncertain.
Whistleblowers Help Stop Tax Fraud
As this story shows, whistleblowers can often provide vital information about ongoing tax fraud. To encourage whistleblowers to come forward, the Tax Relief and Health Care Act of 2006 make whistleblowers eligible, under certain circumstances, to receive a financial award from the IRS Whistleblower Office. The award may vary from 15 to 30 percent of the total amount recovered by the IRS based on the whistleblower’s information.
It is important for whistleblowers to understand their legal rights. Talk to a whistleblower attorney at Waters & Kraus to find out more about the Tax Relief and Health Care Act. Contact us or call our attorneys at 800.226.9880 to learn more about our practice and how we can assist.