Two dentists in Kent, Washington, have pled guilty to filing a false tax return, according to US Attorney Brian T. Moran. Mike Hsieh of Bellevue and Christine Chen of Renton, who co-own Comfort Family Dentistry, conspired to avoid more than $460,000 in income tax payments.
Between 2007 and 2014, Hsieh and Chen took steps to illegally hide their income from the Internal Revenue Service to reduce their tax obligation. US District Judge Richard A. Jones has scheduled their sentencing for November 22, 2019.
According to records filed in the case, Hsieh and Chen maintained two sets of financial statements for their practice. One showed actual expenses, and the other showed inflated expenses. The fraudulent statements were given to their accountant for tax preparation.
The pair also established a bank account that they did not disclose to their tax preparer. Patient fees deposited into the account weren’t reported as income. Finally, Hsieh and Chen took cash proceeds from their practice and never reported that income to their accountant or on their taxes.
For tax year 2013, Hsieh admits he reported a taxable income of $232,753 when it was really more than $100,000 higher. He should have paid taxes on income of $348,663. For the same year, Chen reported $319,131 when her true income was $425,679.
For all of the tax years between 2007 and 2014, they each admit failing to pay about $231,000 in taxes that they should have paid. They have agreed to make restitution of slightly more than $231,000 each to the United States and pay additional tax, penalties, and interest.
Filing a false tax return is punishable by up to three years in prison and a $250,000 fine.