United States v. McKinney, No. 11-3722 (7th Cir. 2012)
Annotate this CaseMcKinney and his brother own a construction business. In 2003, the IRS filed notice of tax liens and pursued collection. McKinney avoided payment by transferring money from the business into accounts used for personal expenses. He made false statements about his ability to pay. He failed to pay taxes during 1999, 2000, 2002, 2003, 2004, 2005, and 2006. Because of the tax liens, McKinney was unable to obtain a residential mortgage. His wife obtained a loan to purchase a home, falsely stating that she was a full-time manager of the construction business with a gross monthly income of $15,374.23. Her husband signed a false employment verification; he earned the income used to pay the mortgage. His brother and his brother’s wife acted similarly. McKinney entered a plea to charges of conspiracy to defraud, impede, impair, obstruct, and defeat functions of the IRS in collection of income taxes, 18 U.S.C. 371; tax evasion, 26 U.S.C. 7201; and false statements to revenue agents, 26 U.S.C. 1001. He received a two-level enhancement to his base offense level for failing to report income exceeding $10,000 from criminal activity, U.S.S.G. 2T1.1(b)(1), and a two-level enhancement for obstruction of justice, U.S.S.G. 3C1.1. The Seventh Circuit affirmed.
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