A Hudson Valley attorney living in Fairfield County will spend time behind bars after admitting to tax evasion and failing to pay over payroll taxes during a long-running scheme.
Danbury resident Francis O’Reilly, an attorney in Putnam County, in Carmel, was sentenced this week to 18 months in prison for an elaborate scheme that cost the U.S. Treasury more than $800,000 following his guilty plea last year.
Prosecutors said that O’Reilly has been permitted to practice law in New York since 1989, and has been a self-employed attorney who worked out of Putnam County at the O’Reilly Law Practice.
In 2015, O’Reilly admitted to withholding payroll taxes from the salaries of some employees of his practice, but reported “substantial amounts of payroll taxes due and owing to the IRS,” Berman said. However, O’Reilly failed to pay those taxes and instead spent the withhold payroll taxes.
According to acting U.S. Attorney Audrey Strauss, O’Reilly failure to pay over payroll taxes for 2015 was part of a long-running course of conduct. Between 1997 and 2018, O’Reilly failed to pay over a total of $155,771 in payroll taxes, resulting in a liability of $232,283 after interest and penalties.
In addition to failing to pay over payroll taxes to the IRS, O’Reilly also committed personal tax evasion.
“Francis O’Reilly, an attorney for three decades, knew his obligations under the law to pay over payroll taxes and to report and pay income tax when due,” Strauss said. “Having admitted his crimes, O’Reilly will now pay the consequences in jail time.”
In addition to his prison time, O’Reilly, 62, was ordered to serve two years of supervised release and will pay the IRS restitution to the tune of $801,969, which represent’s his unpaid tax liabilities, as well as certain penalties and interest, relating to his personal income taxes between 2007 through 2018, payroll taxes between 1997 through 2018, and Federal Unemployment Tax Act taxes from 1998 through 2017.
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