We are committed to closing California's $6.5 billion tax gap, defined as the difference between tax that is owed, and tax that is paid. Our special agents work cooperatively with law enforcement agencies throughout California to uncover illegal behaviors that contribute to the tax gap. These include underreporting income, overstating deductions, failing to file returns, failing to pay taxes due, and making illegal cash payments to employees.
Tax fraud is not a victimless crime. You can report suspected tax fraud by calling FTB at (800) 540-3453.
Modesto doctor must answer for tax evasion
On September 7, a Modesto doctor was held to answer for tax evasion for failing to file state income tax returns, shielding $1.6 million in income.
Thomas Kaschak, 48, a self-employed orthopedic surgeon, also writes medical software under Consolidated Practice Management, Inc. According to FTB special agents, Kaschak allegedly failed to file his 2000-2004 state income tax returns. Kaschak earned more than $1.6 million during these years and owes nearly $138,000 in unpaid tax. FTB special agents arrested him in January.
Each felony tax count carries a maximum term of three years in state prison. FTB agents seized financial documents related to the business operations, which will point to underreported income. Kaschak claims to be a non-resident of California, with a residence in Reno, Nevada. Investigators allege that he has performed more than 1,100 procedures at Memorial Hospital in Modesto since 1996, and has been issued Form 1099s reporting the income.
Arraignment was set for October 1, in Department 8 of the Stanislaus County Courthouse.
Tax evasion lands Orange County attorney in jail
A Brea attorney was sentenced on September 14, to 12 months in the Orange County Jail and five years of felony probation after being found guilty on five counts of felony state income tax evasion.
Harpreet S. Brar, 35, who was found guilty in July, operated a law office in Brea and a limited liability partnership in Long Beach. According to court documents, Brar failed to file his 1999 state personal income tax returns, and his law corporations failed to file its 1999 corporate returns. Moreover, Brar failed to file his 2002 personal income tax return, and for the limited liability partnership.
Brar filed a 1999 personal income tax return after the FTB executed a search warrant in late 2004. However, he failed to claim the more than $1.5 million he received from the sale of securities. Brar was remanded into custody and ordered to pay restitution of more than $800,000, including the business tax, penalties, interest, and the cost of the investigation.