30-Year IRS Agent Arrested for Tax Fraud

Harry Willner, an IRS agent for over 30 years, was arrested yesterday on tax fraud charges.  Prosecutors allege that he and others dodged taxes by claiming that their income was offset by deductions belonging to a company he operated out of his home.  From the Associated Press:

[F]ederal prosecutors said Willner, 59, engaged in the scheme while working as a revenue agent with the large and mid-size business unit of the IRS in New York. They said he carried out the fraud by trying to create tax loopholes while purportedly working as an officer at an advertising business, NIA Advertising Inc., whose address was the same as his residence's. The government said Willner claimed that NIA loaned a company, Royal Magazine Inc., $849,000 from 1998 through 2001 but provided no evidence of a written contract or agreement to verify the debt. Willner then claimed a "bad debt" reduction on NIA's corporate tax return of more than $758,000, though he could not take advantage of much of it because the income of the business was minimal, the indictment said. Afterward, Willner tried to get an accountant to help him get other taxpayers to funnel their income through his advertising business so they could take advantage of the large debt, according to the indictment.

Update:  The 12-page indictment is available here.