Paul L. Caron

Thursday, October 23, 2008

Embattled NY Official Raises "Non-Filers Syndrome" as Tax Defense

Capitol Confidential: O’Byrne’s Attorney: He Had “Non-Filers Syndrome":

Lawyers representing Charles O’Byrne, secretary to Gov. David Paterson, met with reporters in New York City and by teleconference in Albany to release some documents and disclose the chronology of his O’Byrne’s efforts to file and pay his taxes with the state.

Attorneys Henry Berger, an election lawyer, and Richard Kestenbaum, a Long Island-based tax attorney who was a former IRS trial attorney, addressed a number of issues -- O’Byrne’s tax filings, his bouts with mental illness, and other issues that have come out since the story of O’Byrne’s lack of tax filings broke over the weekend.

A few highlights:

  • The attorney provided a summary of the taxes, penalties, and interest owed by O’Byrne from 2001-2005. In total, O’Byrne owed $211,859.87 to the feds, $80,920.15 to the state. Here’s the full summary.
  • Kestenbaum suggested that O’Byrne may have suffered from “non-filers syndrome,” which he said has been a documented disorder. “Many times, these are very high functioning people who can otherwise complete other tasks in their life.” When asked whether he thought O’Byrne suffered from this, Kestenbaum replied, “I do believe he did.”

The press and blogosphere have had a field day with the Non-Filer's Syndrome" defense.  From the New York Daily News: Top Paterson Aide Charles O'Byrne Did Not Pay Taxes Due to 'Non-Filer Syndrome', His Lawyers Say

Alex Raskolnikov, a Columbia Law School professor who specializes in tax law, said that while the IRS can take mental illness into account when assessing penalties, he's never heard of "non-filer syndrome." Rhondalee Dean-Royce, a spokeswoman for the American Psychiatric Association, said no such disorder or syndrome is listed in the Diagnostic and Statistical Manual of Mental Disorders, a standard reference.

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