D.C. AG Files Lawsuit Against Michael Saylor For $25M Tax Evasion

Microstrategy co-founder and former CEO Michael Saylor was charged with evading $ 25 million in district taxes in a lawsuit filed by District of Columbia attorney general Karl Racine.

The lawsuit, brought forward by the allegations of an informant, also names Microstrategy as a defendant. The AG’s office claims the company helped Saylor evade taxes and is seeking to recover $ 100 million in unpaid taxes and penalties.

The lawsuit alleges that Saylor evaded $ 25 million in DC taxes by pretending to be a resident of Virginia from 2005 to 2012 and Florida from 2012 to date.

Saylor “has embarked on a plan to fraudulently pretend to be a resident of Florida, a jurisdiction with no personal income tax,” according to the complaint.

The AG further claims that Saylor got his Florida driver’s license, state voter registration, and a home in Miami Beach, to make his claims seem feasible.

“Since at least 2012, Saylor has bragged to his confidants about his successful plan to create the illusion of residing in Florida to evade personal income taxes in the district,” cites the complaint referring to his social media posts. .

The filing claims that Microstrategy executives were aware that Saylor’s claims of residing in Florida were false and that the company funded his transportation, including a private driver who took him between the company headquarters and his own. penthouse in Washington.

Saylor has allegedly asked the company to file tax documents with the IRS using its Florida address since 2013. At times, in 2014, the company’s CFO claimed that Saylor’s stock is a liability to the company.

Read also: Microstrategy CEO Michael Saylor swaps his role from CEO to President

Saylor reduced his payout to $ 1 in response to concerns from the CFO, according to the AG. However, she continued to receive “high cash value of perks” such as the use of the airline’s aircraft and one-time “gross” payments.

The complaint alleges that Microstrategy’s review and compensation committees were aware of Saylor’s tax evasion activities and “actively assisted” in helping him avoid his obligations.

“I respectfully disagree with the District of Columbia position and look forward to a fair resolution in the courts,” Saylor said in a statement.

Microstrategy also said the allegations are false and that they “will aggressively defend themselves against this overrun”.

The AG is asking the court to make Saylor pay the alleged unpaid taxes, as well as interest, penalties and legal fees.

A whistleblower can receive up to 30% of the funds raised by the district if the lawsuit is successful.

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