After Pleading Guilty to Tax Evasion, Realtor Nicky Sheets Gets 40 Months in Federal Prison

The headline — and the freshly baked press release from the U.S. Attorney’s Office that follows — says it all. U.S. District Judge Jane J. Boyle sentenced high-tone realtor John Nicholas Sheets — married to one Eleanor Mowery Sheets, who copped to four counts of tax evasion but one month ago — to three years and four months in the joint, and he’ll have to fork over $2,408,662 in back taxes since he didn’t bother to pay ’em for the years 1997,
1998, 1999, 2001, 2005, 2006, 2007 and 2008. (Whew.) From the release:

Sheets further admitted that on April 5, 2006, he used a local check-cashing business to conceal the nature of his assets so as to avoid paying federal income taxes. Specifically, he took a $123,000 settlement check to the local check-cashing business to conceal the existence of the funds, and rather than deposit the check into his personal bank account for free, he paid more than $2000 to cash that check. None of the cash he obtained on this date was used to pay the IRS; he used the funds to pay for personal expenses and pay other creditors. The factual resume goes on to state that Sheets negotiated the check in this manner upon the advice, recommendation and suggestion of his attorney at the time.

Eleanor’s scheduled to be sentenced October 12. Oh, and I see their house is still for sale.

DALLAS REALTOR SENTENCED TO 40 MONTHS IN FEDERAL PRISON

FOR TAX EVASION

John Nicholas Sheets Also Ordered to Pay Approximately $2.4 Million in
Back Taxes

DALLAS – John Nicholas Sheets, a.k.a. “Nicky,” was sentenced
this afternoon by U.S. District Judge Jane J. Boyle to 40 months in
prison and ordered to pay $2,408,662 in back taxes, announced U.S.
Attorney James T. Jacks of the Northern District of Texas. Sheets
pleaded guilty in March to one count of tax evasion.

According to documents filed, Sheets is a licensed realtor
who has worked in North Texas for several years. Since 1996, Sheets and
his wife have successfully worked as real estate agents and have
established multiple closely-held businesses including Eleanor Mowery
Sheets, Inc.; Dallas EMS, LLC; and E-Residential, LLC.

According to court records, Eleanor Mowery Sheets pleaded
guilty last month to four counts of failing to pay income taxes. Her
sentencing is set for October 12, 2010.

In the filed documents, John Nicholas Sheets stipulates that
he has substantial unpaid individual and corporate tax debts from 1997,
1998, 1999, 2001, 2005, 2006, 2007 and 2008 totaling approximately $2.7
million, including penalties and interest.

The documents further state that beginning in 1998, rather
than pay his substantial tax debts, Sheets used various business
entities to conceal the nature and extent of his assets. Sheets
admitted to transacting personal business and paying personal creditors
with these funds, rather than paying the Internal Revenue Service (IRS).
Using these businesses, Sheets commingled funds to pay approximately
$435,988 in mortgage interest to three lenders so that he and his wife
could live in a home whose market value exceeded $1.3 million during
that period. Sheets also stipulated that he used commingled funds to
buy personal items (including an interest in a private airplane and
vehicles) and pay numerous personal creditors.

Sheets further admitted that on April 5, 2006, he used a
local check-cashing business to conceal the nature of his assets so as
to avoid paying federal income taxes. Specifically, he took a $123,000
settlement check to the local check-cashing business to conceal the
existence of the funds, and rather than deposit the check into his
personal bank account for free, he paid more than $2000 to cash that
check. None of the cash he obtained on this date was used to pay the
IRS; he used the funds to pay for personal expenses and pay other
creditors. The factual resume goes on to state that Sheets negotiated
the check in this manner upon the advice, recommendation and suggestion
of his attorney at the time.