Former Herrick Feinstein tax lawyer is charged with failing to report $3M in fee income
A former tax shelter partner at Herrick Feinstein has been charged with failing to report to the Internal Revenue Service more than $3 million in fees that he diverted from his law firm.
The Manhattan lawyer, Harold Levine, was charged on Wednesday along with Florida certified public accountant Ronald Katz, report Reuters and the New York Law Journal (sub. req.). Katz was accused of failing to report more than $1.2 million in fee income.
As part of the scheme, Levine is accused of diverting fees paid by one law firm client to a partnership he co-owned with Katz, and then using the fees to buy a residence for a law firm employee, according to a press release. Levine had a personal relationship with the employee and allowed the employee to live in the house for more than five years without paying rent, according to the press release.
Levine and Katz are accused of claiming the home was a rental property on tax returns. Levine is also accused of falsely telling IRS agents that the employee had paid $1,000 a month in rent.
Levine was charged with obstructing the IRS, conspiracy, tax evasion, wire fraud and making false statements. His lawyer, Marc Mukasey, told Reuters, “It is our intention to fight these charges and we’re confident that Harold will be fully exonerated.”
Katz, 59, of Boca Raton, Florida, is charged with obstructing the IRS, conspiracy and tax evasion. Katz’s lawyer, James Froccaro, told Reuters his client maintains his innocence.
The government previously filed a civil suit in 2014 accusing Levine of promoting abusive tax shelters that resulted in hundreds of millions of dollars in improper tax deductions. The case was stayed last year.
Levine left Herrick Feinstein in 2012 and Moritt Hock & Hamroff. He is no longer with that firm.