Paul M. O’Brien
United States Attorney
Hilliard Hester
Assistant U.S. Attorney
Lori Glenn
Assistant United States Attorney
(615) 736-5151
GUILTY PLEAS ENTERED IN TWO FEDERAL TAX CASES
Nashville, TN – August 22, 2007 – Paul M. O’Brien, U.S. Attorney for the Middle District of Tennessee, announced that two defendants in two separate tax cases have entered guilty pleas before U.S. District Judge Aleta A. Trauger.Daniel S. Nutkis, 42, formerly of Brentwood, Tennessee, pled guilty on August 20, 2007 to charges that he willfully failed to file federal tax returns with the Internal Revenue Service for calendar years 2000 and 2001. During the hearing, Nutkis admitted that he earned significant income, approximately $420,000 in 2000 and approximately $608,000 in 2001, on which he knew he was required to file federal income tax returns. Nutkis further admitted that he also failed to file tax returns and pay income taxes for tax years prior to and following 2000 and 2001. A representative of the IRS testified at the hearing that according to IRS calculations, Nutkis owed approximately $343,000 in taxes for 2000 and 2001. His sentencing is scheduled for November 30, 2007.
Chadwick McElhaney, 29, of Crossville, Tennessee, pled guilty on August 21, 2007, to three counts of filing false claims against the government. According to the plea agreement, beginning around February 2003 until approximately April 2004, McElhaney presented false federal income tax returns both in his name and the names of others, which contained materially false statements and facts. The claims included false or inflated information concerning wages, income tax withholdings, dependents for earned income credit, or education credits. The refunds were directly deposited into bank accounts which McElhaney controlled.
McElhaney admitted during his plea hearing that while he was employed as a return preparer for Quick Refund Tax Service, he prepared 35 false federal income tax returns for tax year 2002. McElhaney continued the scheme by preparing 9 additional false tax returns for tax year 2003 using TurboTax Software. McElhaney’s 44 false claims resulted in an intended loss of $98,245, and an actual loss of $51,390, to the United States Treasury. McElhaney is scheduled to be sentenced on November 16, 2007. Both of these investigations were conducted by IRS Criminal Investigation. Assistant U.S. Attorneys Hilliard Hester and Lori S. Glenn represented the government.