IRS Investigating a 537 Consulting-Related, Tax-Violations Complaint Against Annette Taddeo

By: Nancy Smith | Posted: July 25, 2014 3:55 AM
Annette Taddeo Goldstein

Annette Taddeo

The Internal Revenue Service is processing a complaint against Annette Taddeo, gubernatorial candidate Charlie Crist's running mate, for alleged violations of tax law involving employees, including failure to pay tax and failure to withhold tax, while she was chairwoman of the Miami-Dade Democratic Executive Committee.

The federal agency has had the complaint, filed on an "Information Referral" Form 3949 A, since October 2013.

"Reading information given on the form, it looks like the charge is that Ms. Taddeo approved setting up 537 Consulting LLC, a kind of shell company to hide that the DEC has been paying employees as independent contractors for a long time," said Fredericka McClain, a retired University of Central Florida accounting professor.

As soon as DEC Executive Director Juan Cuba registered the company, the complainant writes, Taddeo gave it a contract to take over payroll "'as a solution' to concerns that the party might be in violation of certain IRS rules."

The payroll contract never went out for bid. 

According to the complaint filed in October 2013, "The intent, as stated in (the) Steering Committee meeting was to relieve the Party from liability and the LLC (from) assuming it."

"I reviewed the proposed and accepted budget," writes the complainant. "When I asked about benefits for the workers, I was told that the organization could not afford to pay benefits, including Social Security, etc. I strongly objected for several weeks, months, but was ignored.

"In the second quarter of (2013), in response to my continuing objections, (537 Consulting) LLC was formed and the organization contracted with said LLC to handle payment of compensation to workers.  ... If campaign reports for the fist quarter 2013 are reviewed, it is obvious that workers were paid a flat fee and there is no indication that any withholding or other taxes/benefits were paid."

The complainant bases the DEC's wrong classification of workers as independent contractors on an IRS publication, "Employer's Tax Guide," for use in 2013:

"If you have a reasonable basis for not treating a worker as an employee, you may be relieved from having to pay employment taxes for that worker. To get this relief, you must file all required federal tax forms, including information returns, on a basis consistent with your treatment of the worker.

"You (or your predecessor) must not have treated any worker holding a substantially similar position as an employee for any period beginning after 1977."

The complainant claims Taddeo did not follow these rules.

Nor were the DEC's books and financial records kept in the DEC office or anywhere that the membership or even the Steering Committee could view them. They might have been in treasurer Arthur Costa's possession, which would have been acceptable under the bylaws, but Costa, an employee of BB&T Bank in Miami, was unavailable late in the day Thursday when Sunshine State News attempted to call him.  

Though the DEC's bylaws state that the Steering Committee is supposed to "vet" all contracts, wrote the complainant, members were told that "as long as Chair Annette Taddeo-Goldstein and the legal counsel Joseph Geller and Mr. (Juan) Cuba, president of 537 Consulting LLC, were in agreement with the terms, there was no need for the Steering Committee to review it."

The South Florida office of the IRS would not acknowledge where agents were in their investigation, if the investigation would be complete before November, or if the complainant would be informed of the outcome.

The complainant, who spoke to Sunshine State News on the condition of anonymity, promised, "I will reveal my name in due course. I have said I will testify in court if needed, and I am prepared to do that. This is all just wrong."

In the meantime, what expenditures besides payroll are run through 537 Consulting LLC, or if the company functions as Victory Strategies did for the Republican Party five years ago, remain a mystery.

Reach Nancy Smith at nsmith@sunshinestatenews.com or at 228-282-2423.

Comments (19)

9:10PM JUL 25TH 2014
All these Democrats writing here make me laugh....I bet every one of them had poisonous things to say about Crist four years ago. Especially you, Frank. They are falling over themselves to defend him now......So funny.
1:08PM JUL 26TH 2014
Sorry to bust your uninformed little truthiness bubble . . . . I voted for Crist four years ago . . . . . attempts at right wing demonization and characterization . . . .

Pathetic . . . . .
7:49PM JUL 25TH 2014
Great headline . . . . . . too bad the headline doesn't match the meat (nor the facts) of the article . . . . . no wonder Peter Schorsch labeled this headline & article in his saintpetersblog "just another strange case of Dr. Jekyll and Sunshine State News" while noting that "Oh, wow, this must be a real scandal because the headline has in it “IRS” and “Investigating.” Wrong." . . . . . . . just more demonizing far right partisan headline journalism of the "Big Lie" . . . . .

Pathetic . . . .
Nancy Smith
5:14PM JUL 25TH 2014
Apology to the complainant in my story. I didn't make it clear enough that I have your name, address and telephone number and so does the IRS. By including my agreement to give you anonymity in this story, I apparently left the impression that your complaint was anonymous. It was anything but.
Thank you!
3:18PM JUL 25TH 2014
Not enuf peeps saying thank you Nancy Smith for looking into some new politico on the scene like Taddeo-Goldstein. Trouble is you got two problems:
oh but
3:32PM JUL 25TH 2014
There you go again trying to make this out to be a repukican vs democrap world.

The globalist's own both parties and the fund the infighting just to keep the sheeple looking back and forth and back and forth until they get so dizzy the run down and vote at that electronic scanned paper counting machine that elects the chosen one for the establishment and not the poeple!
3:06PM JUL 25TH 2014
We really hate this time of year of an election year. All the dirt, make up smear along with whatever one thinks will get a vote even if it's made up B.S.! Then there's the polls, P.U.! when were you ever polled? Probably never but even still those Polls swing voters opinions. Now we know why elections are held after Halloween....
3:01PM JUL 25TH 2014
1st, let's see what the IRS finds through there investigation before you start throwing rocks, but then again it's more fun throwing rocks just because someone says it's ok to do so.
1:21PM JUL 25TH 2014
The strange case of Dr. Jekyll and Sunshine State News.

Leslie Wimes
2:39PM JUL 25TH 2014
Looks like SSN posted another article from me!! LOL! Eat it Schorsch!! Oh and please get the spelling of my name correct next time!!
Leslie Wimes
12:50PM JUL 25TH 2014
I have seen the complaint, and I have my own copy of it. This isn't opinion or rumor. Strictly Fact!!
Republican political consultant
3:23PM JUL 25TH 2014
I only wish we had more in OUR party like you. Leslie Wimes, I have been following and admiring you. You have more integrity than just about anyone I know in or out of this business.
10:58AM JUL 25TH 2014
If true, not particularly good, but sure doesn't rise to the level of record-breaking corruption by Scott's company or Scott having to plead the 5th 75 times to cover up his knowledge/participation in illegal activity.
10:29AM JUL 25TH 2014
Nancy, you know you have them when they go after the messenger.....keep up the good work!
10:29AM JUL 25TH 2014
Nancy, you know you have them when they go after the messenger.....keep up the good work!
why is this news anyway?
10:06AM JUL 25TH 2014
This person in not yet an elected official and might never be and you folks have already lambasted her with the Karl Rove[r] David Axelrod political assassination just like the did Sarah Palin.

Since a Tallahassee judge Terry who apparently is now owned by the Bush dynasty has ruled against the dynasty in the congressional distinct's boundaries conspiracy, why is there not a criminal investigation going on right now using the evidence the judge ruled to make his decision regarding these crimes?

Because we are a lawless state and a lawless nation that is why. Obama and his Bush string pullers have the FBI working homeland "scarity" and searching for domestic terrorists aka "truth tellers" instead of policing the criminals they have inserted into our former government offices!

But, Lord just let someone try to run for public office that the "globalists" are afraid they can not control and all the fangs come out.
9:35AM JUL 25TH 2014
Journalism is different than editorialism. The problem with journalism these days is that reporters can't just write news stories. They feel compelled to editorialize. It's Journalism 101 folks. Just give us the facts as you know them and keep the opinion out of it.
8:09AM JUL 25TH 2014
Good OLD Nancy just can't miss a beat on rumors against Charlie. To attempt to highlight am IRS alleged investigation is a clear example of Ms. Smith's attempts to be noticed by the Philadelphia Enquirer!
Either way, the extreme prejudice in reporting is becomming more joke material than anything actually newsworthy!
6:34AM JUL 25TH 2014
Wow! The IRS is investigating. Complainant is "anonymous".

But Nancy, Nancy, Nancy....

"In the meantime, what expenditures besides payroll are run through 537 Consulting LLC, or if the company functions as Victory Strategies did for the Republican Party five years ago, remain a mystery." - this is a S T R E T C H for even you.

Do you have ANY sources or reason to believe that 537 acts like Victory Strategies, or are you slinging mud in ever direction to see if any sticks?

Sad, bad, partisan reporting.

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