Man Admits Trying To Fool IRS By Stripping House
SAN FRANCISCO (AP) _ A real estate salesman pleaded guilty to violating tax laws by stripping a home of its doors, lights and other fixtures and hiding them to try to discourage the Internal Revenue Service from buying the house.
John Pappalardo of San Jose, who entered his guilty plead Friday, faces up to three years in prison and a $5,000 fine. He is to be sentenced Oct. 7.
Pappalardo bought the home at a foreclosure sale in Woodside, a city about 25 miles south of San Francisco, not knowing the IRS had a tax lien on it, said IRS spokesman Larry Wright.
The IRS told Pappalardo three weeks later that it was considering buying the house back at the price he paid for it, then resell it to pay off the earlier owner’s tax lien, Wright said.
He said that Pappalardo, wanting to discourage the purchase so he could resell the house later, stripped it of its doors, plumbing, lights, carpets, sinks and all other fixtures, and hid them in a storage facility.
After Pappalardo denied knowing what had happened, the IRS bought the home at the same price anyway, and sold it to another person at a far lower price than it would have gotten intact, Wright said. The new buyer then filed an unsuccessful suit in state court against Pappalardo, who denied under oath that he had removed the fixtures.
The government later found the fixtures, and filed charges against Pappalardo for impeding the administration of the tax laws, Wright said.