An Alexandria couple pleaded guilty to conspiracy in relation to filing false tax claims for their Maryland-based auto body repair shop, and have been ordered to pay $2.2 million in restitution.
Ercin Kalender, 60, and Lizette Kalender, 44, own Butch’s Auto Body in Capital Heights, and were ordered to pay the $2.2 million as part of their plea agreement, according to an announcement from the U.S. Department of Justice.
Between 2015 and 2018, the Kalenders kept two sets of books — one set with actual revenues, and another with lower reports of taxable income that were sent to the Internal Revenue Service.
“The corresponding tax loss to the IRS for the four years was $2,219,602,” DOJ said in a release.
The couple, who were trying to sell the shop in 2018, were busted in a sting operation in 2018. An undercover federal agent posed as a potential buyer and both Ercin and Lizette Kalender revealed a longstanding practice of underreporting revenue and income.
“Further, Ercin explained that while Butch’s filed tax returns showed $2.2 million in gross receipts, the actual gross receipts were closer to $3.1, $4.2, and $3.9 million for the fiscal years for 2015, 2016, and 2017; respectively,” according to DOJ. “Ercin also informed the agent that Lizette also reported sizable W-2 income, which helped them evade scrutiny by the IRS… In 2019, after the Kalenders became aware of the IRS’s investigation, Butch’s reported gross receipts of more than $4.5 million, an increase of more than $2.2 million over the fiscal year 2018,”
Additionally, the couple paid a portion of their employees in cash and falsely reported wages to the IRS.
“In a conversation with the undercover agent, Ercin stated that he paid all his employees’ extra compensation in cash to avoid tax obligations except for one secretary who was not paid under the table,” DOJ reported.
The couple go to court for sentencing on May 26 and face a maximum sentence of five years in prison and three years of supervised release.
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If you had a chance to enhance a child’s future with a time commitment of less than 2 hours a week, how would you respond? You have that opportunity right now to join over 200 Alexandrians as a reading tutor volunteer with the Alexandria Tutoring Consortium (ATC).
ATC tutors work with one child in kindergarten, first, or second grade in Alexandria public schools who need extra help with reading. Tutors meet with their Book Buddy 1-2 times each week for 30 minutes October-May at school, during school hours. Many struggling readers only receive one-on-one instruction through this program, and it makes all the difference. Last year, ATC served 195 children, of whom 82% ended the year reading on grade level and 96% made substantial reading gains. But the need is great, and we are still seeing learning lags from the pandemic.
This year, ATC plans to significantly increase the size of the program to reach over 250 students and to serve every elementary school in Alexandria. This is very exciting news, but we will only succeed if we can recruit more tutors. ATC trains you, matches you with a child, and provides ongoing lesson materials and support.
If you have been thinking about buying your first home or haven’t owned one in the last three years, THIS IS FOR YOU!
In the DMV area, it can be difficult to save the downpayment necessary for you to get into your own home. We have a solution. The Funder’s Summit!
We have assembled a summit with different municipalities to tell you how to access their funds for your home purchase.