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A Miami man admitted in court to evading federal taxes on millions of dollars in income he earned from selling internet access to American service members and contractors stationed overseas.
According to court documents and statements made in court, Joseph Stewart earned more than $4.5 million in dividends between 2013 and 2018 through a 50% ownership stake in a business providing internet service at Kandahar Airfield in Afghanistan.
During that same period, Stewart also generated income from half-ownership in a separate enterprise selling internet access to troops stationed at Guantanamo Bay, Cuba.
Federal authorities stated that Stewart stopped filing timely tax returns with the Internal Revenue Service once his dividend payments began in 2013. In April 2016, he submitted a false affidavit to U.S. Citizenship and Immigration Services, attaching unfiled copies of federal tax returns while falsely asserting that they had been submitted to the IRS.
When the IRS contacted Stewart in 2019, he hired a tax attorney and tax preparers. Court documents show Stewart lied to these professionals, claiming that more than $3.8 million in dividends received between 2013 and 2018 were nontaxable loans. He also falsely claimed he did not know the other shareholders in the business. Based on those misrepresentations, his tax professionals prepared returns for 2013 through 2020 that underreported his income and tax liability. Stewart then filed the false returns with the IRS, with the exception of a 2013 return that reflected roughly $155,720 in unpaid taxes.
In total, prosecutors said Stewart willfully omitted roughly $4.62 million in income, resulting in a tax loss of approximately $1.57 million to the United States government.
Stewart pleaded guilty to one count of tax evasion. He faces a maximum statutory penalty of five years in prison, along with supervised release, restitution, and monetary fines. A federal district court judge will set his sentence at a later date after reviewing the U.S. Sentencing Guidelines and other relevant factors.
The guilty plea was announced by Assistant Attorney General Colin McDonald of the Justice Department’s National Fraud Enforcement Division and U.S. Attorney Jason A. Reding Quiñones for the Southern District of Florida. IRS Criminal Investigation handled the inquiry, while Trial Attorneys Ezra Spiro and Likhitha Butchireddygari of the Tax Section are prosecuting the case.
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Florida Man Busted For $1.5M Tax Evasion Scheme Targeting Military Internet Profits
