The IRS, saying it has exhausted all administrative avenues to collect unpaid taxes from a Yorktown Heights couple, is seeking the sale of one of their residences to fulfil the obligation.
U.S. Attorney Damian Williams sued Phillip Liu and Ellen Chan-Liu on July 7 in U.S. District Court, White Plains, to recover $70,295 from the U.S. Treasury.
Liu, the former chief financial officer of Guild Concepts Ltd., a White Plains marketing company, has served time in federal prison for embezzling and misappropriating funds from an employee pension plan.
And during the past 15 years, the IRS has assessed him for millions of dollars in taxes and penalties, most of which appear to have been paid off.
The present lawsuit concerns unpaid taxes on income in 2009, the year he was released from prison. Liu, according to the allegation, underreported his income by $88,159. In 2012, the IRS imposed $38,948 in taxes and penalties.
The tax bite has increased to more than $70,295, but despite demands by the IRS, Liu and Chan-Liu, his wife, have reportedly neglected or refused to pay down the obligation.
The feds’ planned remedy is to compel the sale of a 3-bedroom apartment in Elmhurst, Queens that the couple bought in 1999 and rented to a son. The home is worth around $425,000, according to the complaint, and has a mortgage balance of $106,404.
The government is seeking the court to declare that Liu’s stake in the property is subject to a valid federal tax lien, direct any present occupant to vacate the property, order the condo to be auctioned by the U.S. Marshal, and apply Liu’s part of the revenues to the tax obligation.
Attempts to discover contract information for the couple, and to inquire about their side of the tale, failed.
Liu’s tax difficulties appear to originate from the Guild Concepts embezzlement.
From 1998 through 2003, Liu didn’t deposit more than $351,000 in contributions to the pension plan, according to court filings, and in 2003 he made illicit withdrawals of more than $996,000. In all, he denied 52 employees approximately $1.35 million in pension payments.
Liu had relocated as a child from Hong Kong, where the family had maintained a middle-class lifestyle in China, according to a 2005 sentencing report by his counsel. But in the U.S. his parents struggled, and the home dynamic was poisonous and abusive.
Liu stole pension funds to satisfy Guild Concepts payroll taxes and operational costs, according to his lawyer. But he also gambled to escape the tension. From 2002 through 2004, for example, he lost $454,105 gaming at Mohegan Sun Casino in Uncasville, Connecticut.
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In 2004, he pleaded guilty to stealing from the pension plan and producing bogus quarterly reports. In 2005 he was sentenced to 57 months in jail.
In 2007, the IRS assessed Liu for more than $1.3 million for failure to collect employment taxes. By January 2020, the debt had decreased to roughly $436,000.
In 2019, he was assessed more than $2.1 million for employee benefit plan excise taxes. Last year, the IRS released that tax lien.
