Used car salesman accused of hiding $326K in Missouri commissions. Here’s how, feds say

A used car salesman admitted to hiding over $326,000 in Missouri sales commissions as part of a years-long federal tax scheme, authorities say.

In doing so, Donald Benck is accused of stealing $84,092 in tax dollars from the IRS, according to a news release from the U.S. Attorney’s Office in the Eastern District of Missouri. Here’s how authorities say he did it.

While the man was working at a used car lot in Imperial, he was mostly paid through his sales commissions, according to court records.

From 2014 to 2016, authorities say Benck recruited acquaintances to serve as his nominees to accept his commission checks, which would be written out to them — and for them to cash.

His acquaintances would cash the checks, keep a small fee for themselves and then give the rest of the money to Benck, according to his plea agreement signed Monday, Aug. 8.

The car dealership then issued Tax Form 1099 to the nominees and not Benck, and officials say he never told his tax preparer that he was ultimately receiving the commissions as income. Form 1099 is used to report miscellaneous income, including direct sales.

This means that when Benck submitted his annual Income Tax Return, for three years, his income was under reported, according to the plea agreement.

Benck’s defense attorney did not immediately respond to a request for comment from McClatchy News.

“Benck’s tax returns failed to fully disclose the funds he received through the checks his nominees cashed,” court records state. “At his direction, Benck’s nominees cashed over $326,000 in checks representing Benck’ s sales commissions from 2014 to 2016.”

The following income was not reported each year, according to officials:

• $31,300 in income for tax year 2014
• $131,400 in 2015
• $93,035 for 2016.

This resulted in the $84,092 IRS tax loss.

Benck pleaded guilty to three counts of “false statements on income tax return,” according to court records. His sentencing date is scheduled for Nov. 18. He faces up to 3 years in federal prison and a fine of up to $100,000, court records show.

Imperial is about 20 miles southwest of St. Louis.

This story was originally published August 9, 2022 at 8:42 AM with the headline "Used car salesman accused of hiding $326K in Missouri commissions. Here’s how, feds say."