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http://www.billingsgazette.net/articles/2007/11/27/news/local/30-laurel.txt
Laurel tax protester, wife face trial
By CLAIR JOHNSON
Of The Gazette Staff
A Laurel tax protester and his wife are to stand trial starting Wednesday on federal charges of conspiring to avoid paying income taxes.
Henry Lynn Matthies and his wife, Judy Matthies, pleaded not guilty Monday to a second, superseding indictment charging them with conspiracy. Henry Matthies also is charged with two counts of willful failure to file income tax returns, a misdemeanor.
The latest indictment added the words "by deceitful and dishonest means" to the conspiracy count. The couple was first indicted in March.
The government alleges that for 10 years beginning in 1997, the couple defrauded and obstructed the IRS by hiding income and using trusts to create barriers to tax collection. According to the indictment, Henry Matthies improperly claimed nine deductions on his W-4 form from his employer, Big Sky Irrigation Inc., and submitted returns stating that he had no income or deductions. The couple also allegedly cashed work-related checks belonging to Henry Matthies instead of depositing them in a bank account.
The government further alleges that the couple transferred titles to a truck and their house to trusts in which Judy Matthies was a trustee.
The misdemeanor counts allege that Henry Matthies had $12,950 in income in 2000 and $13,400 in income in 2001 and failed to file a tax return.
If convicted, the defendants face a maximum of five years in prison and a $250,000 fine on the conspiracy count.
Nine years ago, Henry Matthies was sentenced to a year and a day in federal prison and was ordered to pay about $10,000 in prosecution costs after a jury convicted him of three counts of failing to file income taxes. Representing himself at trial, Matthies argued that he acted in good faith in not filing tax returns because his interpretation of the tax code convinced him he didn't have to.
This time, Matthies is represented by attorney Lowell Becraft Jr. of Huntsville, Ala., who in May defended Rolan Becker, a Ronan forester for the Confederated Salish and Kootenai Tribes, on three tax evasion charges.
Prosecutors said Becker filed false W-4 forms with the IRS so he wouldn't have federal taxes withheld and transferred his house and vehicles to limited liability corporations to put them beyond reach of the IRS.
Becraft argued that Becker sincerely believed that he didn't have to pay taxes based on information he got from seminars, books and tapes.
Earlier this month, Senior U.S. District Judge Charles Lovell in Helena sentenced Becker to 27 months in prison and ordered $91,700 restitution plus $1,700 in prosecution costs. Lovell said Becker could be viewed as an "economic terrorist" similar to the anti-government Montana Freemen.
Published on Tuesday, November 27, 2007.
Last modified on 11/27/2007 at 12:47 am
Laurel tax protester, wife face trial
By CLAIR JOHNSON
Of The Gazette Staff
A Laurel tax protester and his wife are to stand trial starting Wednesday on federal charges of conspiring to avoid paying income taxes.
Henry Lynn Matthies and his wife, Judy Matthies, pleaded not guilty Monday to a second, superseding indictment charging them with conspiracy. Henry Matthies also is charged with two counts of willful failure to file income tax returns, a misdemeanor.
The latest indictment added the words "by deceitful and dishonest means" to the conspiracy count. The couple was first indicted in March.
The government alleges that for 10 years beginning in 1997, the couple defrauded and obstructed the IRS by hiding income and using trusts to create barriers to tax collection. According to the indictment, Henry Matthies improperly claimed nine deductions on his W-4 form from his employer, Big Sky Irrigation Inc., and submitted returns stating that he had no income or deductions. The couple also allegedly cashed work-related checks belonging to Henry Matthies instead of depositing them in a bank account.
The government further alleges that the couple transferred titles to a truck and their house to trusts in which Judy Matthies was a trustee.
The misdemeanor counts allege that Henry Matthies had $12,950 in income in 2000 and $13,400 in income in 2001 and failed to file a tax return.
If convicted, the defendants face a maximum of five years in prison and a $250,000 fine on the conspiracy count.
Nine years ago, Henry Matthies was sentenced to a year and a day in federal prison and was ordered to pay about $10,000 in prosecution costs after a jury convicted him of three counts of failing to file income taxes. Representing himself at trial, Matthies argued that he acted in good faith in not filing tax returns because his interpretation of the tax code convinced him he didn't have to.
This time, Matthies is represented by attorney Lowell Becraft Jr. of Huntsville, Ala., who in May defended Rolan Becker, a Ronan forester for the Confederated Salish and Kootenai Tribes, on three tax evasion charges.
Prosecutors said Becker filed false W-4 forms with the IRS so he wouldn't have federal taxes withheld and transferred his house and vehicles to limited liability corporations to put them beyond reach of the IRS.
Becraft argued that Becker sincerely believed that he didn't have to pay taxes based on information he got from seminars, books and tapes.
Earlier this month, Senior U.S. District Judge Charles Lovell in Helena sentenced Becker to 27 months in prison and ordered $91,700 restitution plus $1,700 in prosecution costs. Lovell said Becker could be viewed as an "economic terrorist" similar to the anti-government Montana Freemen.
Published on Tuesday, November 27, 2007.
Last modified on 11/27/2007 at 12:47 am
