Feds sue chiropractor, allege failure to report foreign accounts
YOUNGSTOWN — Attorneys with the Tax Division of the Treasury Department have filed a complaint against a Boardman chiropractor alleging she owes $366,558 plus interest for failing to report foreign bank accounts to the federal government.
The complaint was filed Tuesday in U.S. District Court, alleging that Denise Carradine, owner of Carradine Chiropractic Center Inc. and Breath of Vitality Inc. Pilates studio, both of Boardman, opened an account with the Swiss bank Maerki Baumann & Co. in 2006 and deposited about $814,000 in the account through June 2008.
She put funds from her companies in the account, the suit states.
She later transferred the funds to an account with Grand Palm Ltd. in the Turks and Caicos Islands and then closed that account in 2014 and transferred the funds to the United States.
She did not disclose the existence of the Maerki or Grand Palm accounts or a domestic bank account to her tax return preparer for the tax years 2006 through 2012, the suit alleges.
Carradine’s attorney, Roger Stewart, said he and Carradine do not understand why a lawsuit was filed against Carradine because she addressed her issues with the federal government in the past, “and it was all resolved.”
Stewart said he suspects this is a case in which the “left hand (of the federal government) doesn’t know what the right hand is doing.”
In 2014, Carradine hired a new tax return preparer and amended her tax returns for 2006 through 2012 to report income of about $450,000, the suit states. No interest income from the foreign accounts was reported on any amended return, and none of the returns were filed with the government, the suit states.
Carradine applied for “preclearance” in the Internal Revenue Service’s Offshore Voluntary Disclosure Program, the suit states. The OVDP is for taxpayers facing possible criminal liability and / or substantial civil penalties for willfully failing to report foreign financial assets and pay all tax due as a result of those assets, according to the IRS website.
The suit alleges Carradine was required to report foreign bank accounts, securities or other financial accounts in 2007 through 2013 in a form called a Report of Foreign Bank and Financial Accounts, but she did not file the forms.
As a result, an assessment of $366,558 was levied against Carradine Dec. 21, 2018, by the Treasury Department, and Carradine is liable for a late-payment penalty and interest, bringing the total to $399,808, the suit states.
The suit was filed by Richard Zuckerman, principal deputy assistant attorney general for the tax division of the Justice Department.
Judge Benita Pearson and Magistrate Carmen Henderson are assigned to the case.