A state crackdown on tax cheats has resulted in recent indictments and convictions in the past two months.
While defendants have not been receiving jail time, they are being ordered to pay restitution, perform community service and comply with court-imposed conditions or else face jail.
>> On Dec. 9 an Oahu grand jury indicted Waianae resident Marks Kahikina Jr., 62, on 20 counts for helping others as well as himself evade taxes.
Those convicted face prison terms ranging from one year in jail to 10 years in prison and fines ranging from $25,000 to $100,000 per count.
He is charged with assisting others in preparing false returns that reported they were entitled to a refund of all their state withholding taxes to avoid their income tax obligations for tax years 1998 to 2001.
Kahikina, an Oahu Transit Services Inc. employee, is also charged with filing false state income tax returns for 2000 and 2001. According to the indictment, Kahikina had gross income of $39,680 in 2000 and maintained a false employee withholding allowance certificate with his employer by reporting he was entitled to 99 withholding allowances. He allegedly did the same for 2001 when he had gross income of $43,365.
>> On Dec. 22, Waianae residents Charles Reinhardt, 52, and Linda Reinhardt, 48, were granted deferral of their guilty pleas to four counts of attempting to evade a tax by filing fraudulent tax returns from 1998 through 2001 based on frivolous advice that their wages were not subject to taxation. Each must follow court-imposed conditions for five years, pay $1,500 to the state, make restitution to the state for the taxes they evaded from 1998 to 2001 and perform 100 hours of community service.
>> On Dec. 9, Mililani resident James Dysarz, 49, was granted a five-year deferral of his no-contest plea to second-degree theft. He was ordered to pay $19,136 in restitution, $8,000 of which must be paid by Wednesday. He was also ordered to undergo substance abuse assessment and get drug treatment if needed.
A state Department of Taxation investigation found that in 2003, Dysarz obtained a state tax refund of $19,136 by overstating the amount of state tax withholding credit on his 2002 individual income tax return.
>> On Nov. 25, Honolulu real estate executive Frederick Overstreet, 74, was granted a deferral of his no-contest pleas to three counts of willfully failing to file general excise tax returns on real estate commissions for calendar years 1999, 2000 and 2001. Overstreet, president of Capital Research Group Inc., was ordered to file his tax returns and immediately make payment of $7,500 to the state.
>> Daniel Doyle, vice president of Capital Research, also was granted a deferral of his no-contest pleas to five counts of willfully failing to file his general excise tax returns on real estate commissions for calendar years 1996 through 2000. He was required to file his tax returns and make immediate payment of $15,000.
>> On Nov. 18, Kauai Freight Service Inc. pleaded no contest to one count of first-degree theft and attempting to evade a tax. Company President Stephen Girald, 57, also pleaded no contest to first-degree theft. Vice President Ashlet Girald plead no contest to attempting to evade a tax.
An investigation showed Kauai Freight was not paying withholding taxes to the Department of Taxation and that Ashlet Girald was trying to evade state taxes by making false entries in business records. The Giralds and the corporation will be sentenced Jan. 29.
>> On Nov. 12, Honolulu residents Alvin Tung, 54, and his wife, Betty Tung, 53, each pleaded no contest to one count of attempting to evade a tax and one count of filing false state income tax returns.
The couple followed the advice of a tax return preparer that wages are not taxable in Hawaii and asserted they were entitled to a refund on all their state withholding taxes for 2000 and 2001. Both will be sentenced Feb. 9.
>> On Nov. 26, Honolulu resident Gilbert Tung, 26, pleaded no contest to one count of attempting to evade a tax. He allegedly filed a false tax return for calendar year 2001 based on his position that wages were not subject to taxation in the state. He will be sentenced Feb. 17.