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Nevada Firm Banned for Tax Scheme
Sea Nine Associates Inc. has been permanently barred from selling and managing an alleged nationwide tax scheme that involved using welfare benefit plans to unlawfully increase and accelerate tax deductions and avoid income taxes, according to a federal court ruling.
A U.S. District Judge Josephine L. Staton for the Central District of California entered a judgment of permanent injunction against Sea Nine on Sept. 12. The scheme, which was marketed to more than 200 entities, allowed companies to pool together and make monetary contributions toward the purchase of life insurance for the benefit of each participating company’s employees or principals.
Participants in legitimate welfare benefit plans may be able to deduct their plan contributions as a business expense. However, the government alleged that Sea Nine marketed the unlawful welfare benefit plans to numerous entities.
The injunction order bars Sea Nine from selling and managing any purported welfare benefit plans. This move is part of the government’s ongoing efforts to stop tax fraud promoters and tax return preparers.
Since the past decade, the government has obtained more than 500 injunctions to stop tax fraud promoters and tax return preparers. Information about these cases is available on the government’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page.
If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details. The case, United States v. Kenneth Elliott, etc. et al., also includes a default judgment and permanent injunction against Sea Nine Associates, Inc.
Related Materials: United States v. Kenneth Elliott, etc. et al.
Default Judgment and Permanent Injunction Against Sea Nine Associates, Inc.
Key Facts
- State: California
- Category: White Collar Crime|Fraud & Financial Crimes
- Source: DOJ Press Release ↗
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