Wisconsin Tavern Owner Filed False Tax Returns

By January 1, 2016Tax Fraud

On Nov. 12, 2014, in Madison, Wisconsin, Jared Jerome Hart, of Eau Claire, was sentenced to 18 months in prison and ordered to pay a $100,000 fine. Hart pleaded guilty on Aug. 12, 2014, to filing false tax returns. Hart will have to work with the civil collection division of the IRS for repayment of taxes. Hart was also required to pay restitution to the Wisconsin Department of Revenue for non-payment of Wisconsin sales taxes. According to court documents, between 2008 and 2011, Hart owned a tavern in Eau Claire called The Pickle Bar. The Pickle Bar accepted payment only in the form of cash and at the end of each day, tavern employees would place daily sales in a safe for Hart to pick up. Hart would bring the cash home, count it using his cash-counting machine, and then record a number for the day in his own daily calendar. Hart would then deposit only some of the cash from the business into the business bank account. At the end of each month, Hart would give his accountants incomplete payroll information, the business bank statements, the business check register, and vendor invoices. Hart never told his accountants about the cash he was “skimming” from the tavern, or the second set of books he was keeping at home. Between 2008 and 2011, there was more than a $1 million discrepancy between the gross receipts of The Pickle Bar reflected in the books the accountants maintained and the second set of books Hart maintained at his home. Hart’s accountants used the incomplete information provided to them by Hart to generate the false Corporate Income Tax Forms for the tavern that were filed with his individual tax return for tax years 2008 through 2011. The artificially low business income was used on his personal income tax return. The total tax loss was $367,278.