Former tax court judge is indicted on tax-evasion charges
A U.S. Tax Court judge who retired in 2014 has been charged with tax evasion.
Former Judge Diane Kroupa and her husband, Robert Fackler, were charged in an indictment unsealed on Monday, report the Minneapolis Star Tribune, Forbes and the Twin Cities Pioneer Press. They are accused of claiming nearly $1 million in fraudulent deductions from 2004 to 2010, a period during which Kroupa was a judge. TaxProf Blog links to a press release announcing the charges.
Kroupa and Fackler are charged with conspiracy, tax evasion, making and subscribing false tax returns, and obstruction of an Internal Revenue Service audit.
Prosecutors allege Kroupa and Fackler claimed $500,000 in personal expenses such as business expenses at Fackler’s lobbying and political consulting firm, and another $450,000 in business costs for which clients had reimbursed them.
Personal expenses that were deducted included money spent on Pilates classes, spa fees, clothing, home renovations, a wine club, music lessons and vacations, prosecutors said. Kroupa and Fackler are also accused of failing to report more than $44,000 received by Kroupa on a 2010 land sale, and of falsely claiming insolvency to avoid paying tax on a $33,000 canceled debt.
Kroupa practiced tax law at Faegre & Benson before she became a tax court judge. Her first appointment was to the Minnesota Tax Court. She was appointed in 2003 to the U.S. Tax Court in Washington, D.C.
Tom Brever represents Kroupa and Fackler. He told the Pioneer Press that he had not yet read the indictment and couldn’t comment in detail. “Any indictment is serious, of course, and we will take it seriously,” he said.