Ex-IRS Worker, Wife Indicted on Charges of Lying in Audit

A San Juan Capistrano man and former supervisor with the Internal Revenue Service was indicted Wednesday with his wife on charges that he lied to an IRS agent during an audit of his tax returns.

The indictment by a federal grand jury in Los Angeles alleges that Thomas J. DiMuzio, 51, and Kathleen DiMuzio, 46, sold their Laguna Hills home in August 1987 and bought a new home in San Juan Capistrano in January 1990. Because the two-year grace period permitted by the IRS had passed, they were required to pay taxes on the profit from the sale.

The indictment alleges that the couple falsely stated on their 1989 income tax return, while DiMuzio was working for the IRS, that they had moved into the new home within the grace period. They are accused of providing false documents to the auditor supporting their claim.

The DiMuzios are charged with six counts of conspiracy, obstruction of a federal audit and making fraudulent misrepresentations to an IRS agent.

They could be sentenced to as many as 28 years in prison, but probably would receive a sentence “substantially less than that,” said Marc C. Harris, the assistant U.S. attorney prosecuting the case.

The indictment is the result of an investigation by the IRS’s Internal Security division. The couple were audited at random, Harris said.

“What the DiMuzios did would be inappropriate whether they were IRS employees or regular citizens,” Harris said. “The IRS takes allegations of employee misconduct very seriously because they are entrusted with such significant responsibilities.”

Thomas DiMuzio resigned from his job as a supervisory revenue officer with the IRS in the fall of 1993, Harris said.

The couple will be arraigned next month before a magistrate in Santa Ana.