Independence Business Owner Pleads Guilty To Filing False Tax Return

Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that the owner of an Independence, Mo., business has pleaded guilty in federal court to failing to report business income on her federal income tax return.

Peggy Hennon, 57, Independence, the owner and operator of Peggy’s Tow, pleaded guilty before U.S. Magistrate Judge John T. Maughmer on Monday, March 2, 2015.  Hennon pleaded guilty to filing a false income tax return for the 2007 tax year. The government contends that Hennon failed to report more than $192,000 in business income.

Peggy’s Tow purchased vehicles as scrap and sold them to scrap yards in the Kansas City metro area. After the vehicles were sold to the scrap yard, Hennon either deposited the check into one of her checking accounts or cashed the check at a gas station or bank.

According to the plea agreement, Hennon engaged in a scheme to falsely under-report the gross receipts for her business in order to significantly reduce her tax liability. Although Hennon used a professional tax preparer, she provided the information regarding her income and expenses. Hennon cashed a significant amount of checks she received from the sale of scrap vehicles and failed to include those cashed checks on her tax returns for tax year 2007.

Hennon filed her federal income tax return for 2007 on Oct. 16, 2008. Hennon substantially understated her gross receipts in the amounts of $192,201 for tax year 2007. Hennon stated that she received $168,549 in gross receipts in tax year 2007 when she actually knew her gross receipts were at least $360,750. The additional tax due and owing for 2007 is $57,726.

Under federal statutes, Hennon is subject to a sentence of up to three years in federal prison without parole, plus a fine up to $100,000 and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

This case is being prosecuted by Assistant U.S. Attorney Roseann A. Ketchmark. It was investigated by IRS-Criminal Investigation.

Courtesy of Tammy Dickinson, United States Attorney for the Western District of Missouri)