Newport Beach Businessman Sentenced to Over 2 Years for Sales Tax Evasion and to Pay Restitution to Board of Equalization

Life's not always a beach, even for the Beach Cruiser business "Let It Roll" owner in Newport Beach and Costa Mesa.  On June 13, 2014, the Orange County Superior Court sentenced a local businessman, Douglas Lachman, to 27 months for sales tax evasion, according to a press release issued by the California Board of Equalization.  The business was a bike sales and rental shop that focused on the beach cruiser market for tourists.  Between 2002 and 2009 there was about $7 million under-reported sales, though this resulted in  a sales tax loss of only $553,478.

The State Board of Equalization is the California tax agency responsible for the administration of the sales taxes (among other types of taxes). The case was prosecuted by the Orange County District Attorney's Office, which is a reminder, as we know all too well from our experience in California Audits of Medical Marijuana Tax Dispensaries, tax problems can come from all sides and the state (and cities) wants that tax money just as bad as the IRS.  Of course, one of the purposes of this press release from the BOE is to encourage compliance, and both state and federal levels have  voluntary disclosure programs where you can pay the taxes and civil penalties instead of going to jail as long as they haven't already received information about you.