Forbes: IRS Seeking $71 Million in Back Taxes from Conrad Black

By: E&P Staff

Conrad Black is challenging a $71 million bill from the Internal Revenue Service, which contends he owes taxes on $120 million in income he made between 1998 and 2003, Forbes reported on its Website.

The article by William P. Barrett says Black has filed a lawsuit in U.S. Tax Court contending the income wasn’t taxable under U.S. law. Black, born in Quebec, renounced his Canadian citizenship in a widely publicized row with the prime minister at the time in order to accept an appointment to the British House of Lords. He is now serving a 6 1/2-year sentence for fraud and obstruction of justice related to taking improper fees on sales of newspapers from his old Hollinger International chain.

Forbes also reported lawsuits filed by Black’s former lieutenant – and witness for the federal prosecution – F. David Radler, who was publisher of the Chicago Sun-Times, and by Peter Y. Atkinson, a Hollinger top executive convicted along with Black in the federal fraud trial in Chicago.

The IRS contends Radler improperly failed to file returns for the years 1998 to 2003 on $111 million in taxable income. The IRS is seeking taxes of $66 million, the lawsuit indicates. Radler pleaded guilty to a single count of fraud in a plea agreement requiring his testimony against Black. He was sentenced to 29 months in jail, but transferred to a Canadian prison and released after 10 months.

Forbes reports the IRS is seeking $1.3 million from Atkinson, who served two years on his conviction. The tax authority says he filed no returns on taxable income of $2.2 million for two years.

All contend they were not subject to taxation because they were not U.S. citizens nor residents.

“Bryan C. Skarlatos, Black’s New York tax lawyer, declined extensive comment. But he said that under relevant international tax treaties, only one country at a time–and for his client, not the U.S.–can assert jurisdiction for tax purposes,” Forbes reported.

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