Couple Plead Guilty to Tax Fraud Scheme
A Northern California couple pleaded guilty Monday to conspiring to defraud the government by persuading 265 people to invest $1.4 million in bogus entertainment partnerships and claim inflated tax deductions.
Jack Elliott, 68, and Maxine Elliott, 63, of Aptos pleaded guilty in federal court in Los Angeles to conspiracy and aiding and counseling the filing of false income tax deductions stemming from their 1982 promotion of a fraudulent tax shelter.
Assistant U.S. Atty. Stephen Mansfield said the Elliotts, who ran a Culver City tax preparation business from 1960-1982, defrauded the taxpayers by selling them sham tax shelter partnerships in the production of television pilot films or documentaries to be sold to networks. The films were never made, he said.
The couple advised their clients to take tax deductions four times greater than their actual investment, Mansfield said. The Elliotts’ clients took a total of $6.4 million in false partnership loss deductions in 1982, which defrauded the Internal Revenue Service of $2.1 million in taxes owed, he said.
Taxpayers ultimately lost their investments and were assessed income tax penalties, Mansfield said.