Paul Douglas Kelly, a 53-year-old Cadillac chiropractor accused of tax evasion, was sentenced to two years in prison on Monday December 3rd. Additionally, Kelly will pay $279,145 in restitution and be placed on supervised release for two years upon the end of his prison term. The chiropractor was sentenced in Kalamazoo by U.S. District Judge Paul Maloney.
According to news reports, the government alleged that Kelly’s chiropractic business earned him $2.2 million from 1999 to 2006, but that Kelly understated his tax liability by $250,000. Kelly allegedly paid only $23,601 in taxes on the income for the years in question.
Kelly has been in the chiropractic field in the Cadillac area for two decades; he first owned the Kelly Chiropractic Center, then the Advanced Chiropractic Center later.
The government alleges that Kelly kept two sets of books, and that he inflated business related expenses while underreporting income. Kelly reportedly gave inaccurate records from the two sets of books to tax preparers, and regularly claimed expenses which were personal on federal income tax returns. Some of these personal items included hunting and snowmobile gear and collectible toys.
IRS criminal investigation special agent in charge Erick Martinez said in a statement that “Kelly went to extraordinary means to hide his income.” Apparently, Kelly learned that he could save significantly on taxes when he attended a seminar in 1996; it was at this seminar that Kelly is said to have met a “notorious tax protester and fraudster.” Kelly’s attorney, Brian Lennon, wrote in a sentencing memorandum that Kelly’s accountant advised him not to follow the advice of the fraudster, but that he didn’t listen.
Kelly pleaded guilty to tax evasion in August of this year, and was freed on a $25,000 bond pending his December sentencing.
Situations like this not only leave the convicted individual facing prison time and a criminal record, those who are in a highly regarded and licensed profession have their reputations ruined forever. It is critical that those accused of tax fraud or evasion, embezzlement, forgery or other fraud or theft charges consult with a talented Michigan fraud defense attorney who will work diligently to protect your legal rights, reputation, and freedom.