Michael E. Ho, Tax Evasion, Colorado 2015

Grand Junction Business Owner Sentenced for Tax Evasion in Colorado

A 69-year-old Grand Junction man has been sentenced to 24 months in federal prison for income tax evasion, according to the U.S. Attorney's Office for the District of Colorado.

Michael E. Ho, of Grand Junction, was sentenced on December 14, 2015, by U.S. District Court Judge Christine M. Arguello to serve 24 months in federal prison, followed by 3 years of supervised release. Ho was also ordered to pay $202,442 in restitution to the Internal Revenue Service.

The indictment and stipulated facts contained in the plea agreement state that Ho owned and managed a dental clinic formerly known as Skyline Dental, located in Grand Junction, Colorado, from approximately 1999 through at least 2004. He employed licensed dentists to provide dental services to patients. Skyline Dental operated as a 'd/b/a' for the parent corporation 'Five-O Enterprises' which Ho owned and controlled starting in the year 2001.

Ho sold the practice in December 2004 to a licensed Dentist and Ho was hired to manage the clinic. In 2006, Ho and the owner had a business dispute which resulted in the dentist defaulting on his purchase agreement with Ho. Ho then sold the practice to a different dentist in November of 2006 for $3.5 million. Ho was then paid a salary for managing the dental practice. In 2010, the Dentist rescinded his contracts with Ho. Ho in turn converted Skyline Dental clinic to a non-profit corporation, Colorado Community Dental Services 'CCDS', which allowed it to operate under state law without a dentist as its owner.

During this same period, Ho also operated Preventative Dental as a d/b/a of Five-O Enterprises which sold dental plans to individuals and were then able to receive discounted dental services by the designated provider, Skyline Dental and later Colorado Community Dental Services. Ho received the income from Preventative Dental.

A total of $202,442 is the total tax due and owing by Ho. In an attempt to evade assessment of taxes by the IRS, Ho took a series of steps to include, but are not limited to, utilizing multiple bank accounts (a personal account and business accounts) which he commingled funds from his various income producing activities making the assessment of tax difficult; he received interest income from the sale of Skyline Dental and did not report the interest income to his accountant in the years 2008 and 2009 when he received interest income of $156,005 and $67,225, respectively; he did not report the income from the sale of discount dental plans to his accountant and thus the income from Preventative Dental was not reported on his tax returns; he deposited cash receipts from Skyline Dental and Colorado Community Dental Services to his personal bank accounts in 2010 and 2011 and did not report the income on his tax returns.

Source: https://www.justice.gov/usao-co/pr/grand-junction-business-owner-sentenced-income-tax-evasion