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RALEIGH — The secretary/treasurer and bookkeeper of Butlerbuilt Motorsports Equipment, a Concord-based vendor of customized seats and other gear for race cars, was arrested Wednesday on charges that the company kept more than $400,000 in state and county sales tax and $261,000 in income tax from employees' paychecks from as far back as December 2003.

Barbara Butler, named in three arrest warrants obtained by the state Department of Revenue, was listed in those as Barbara Beard Butler and on Wake County arrest records as Barbara Jean Butler.

Butler, 61, of 8263 Addison Drive in Harrisburg, was being held in the Wake County Detention Center in lieu of $1 million bail for a first court appearance Thursday in Wake County District Court.

She was arrested at her home Wednesday morning, records show.

The warrants charged two counts of embezzlement of state property, citing the income tax and state sales tax, and one count of embezzlement by a public officer or trustee because companies that collect county sales taxes are considered trustees of the counties.

The warrants say the money was converted to the company’s use, not Butler’s.

Butler, the warrants obtained by DOR Investigator Marla J. Bryant said, was the secretary/treasurer and bookkeeper for Butler Specialties Inc. and was the person who should have sent the money to the department.

Butler Specialties does business as Butlerbuilt Motorsports Equipment, Bryant wrote. The company advertizes Butlerbuilt Professional Seat Systems on its website.

The income tax withheld from employees – $261,388.09 – was not turned over to the state between July 4, 2009, and Jan. 1 of this year, one warrant alleged.

The other two charge Butler with not turning over $267,893.09 in state sales tax and $132,965.97 in sales taxes for “numerous counties” between Dec. 1, 2003, and Jan. 20 of this year.

Read more here: http://www.newsobserver.com/2014/04/24/3807848/state-charges-bookkeeper-helped.html?sp=/99/102/#storylink=cpy

Wow

yikes.

With the changes in how companies do business (internet, multiple states), things have goten really "fuzzy" as to whom sales tax is owed (or owed and collected at all).

In Iowa, if you don't have a brick and mortar building within the state you don't collect sales tax (and send it to the state).  However, they have been working on changing this so that any goods sold here are subject to sales tax.

My guess is that NC or specifically Carrabus County (Concord, NC) are viewing all sales as occuring in their county and want the taxes even if they weren't sold there (and they couldn't legally charge tax where they sold it).

Payroll taxes are even messier as you have income taxes in the state where you "earned" the money if you are a qualifying employee (and that is even messier).  So, if you work for Company A located in Iowa for example but you live in South Dakota (that doesn't have income tax), you still owe income tax in Iowa even though you aren't a resident.

That makes it very difficult for the company to know who they do and don't need to send payroll taxes in for.

Happens all the time in business and from reading that above, she wasn't embezzling.  The $$ went back into the company so therefore they believed they didn't owe the tax (ie:  we sold our product in PA, IA, CA or any other state and because we don't have a building there, we cannot legally charge sales tax so we didn't collect it and didn't pay any in).

The state is ACCUSING them of not paying tax.  Until the tax lawyers and everyone pour over all the books, no one really knows anything (including the state and county).  Once that is done, it may come to be a bunch of BS and no charges will be filed and it may never go to court.  Or, it may be that the convoluted laws are interpreted differenty by the Dept. of Revenue than it is by companies, lawyers and even a judge.

I look for this to make it to a courtroom in 5-10 years at the earliest....

Bingo

 Why the hell did they put a million $ bail on her, did they think she was a flight risk?

Half the lies they tell about me aren't true. 

Must have donated money to the tea party

If she worked for the IRS and didn't pay taxes, she'd get a performance bonus.

That's a hall of fame post, smoke.  Well played.

"I'd pay $15 to watch a sprint car sit still."

Wasn't Embezzling? 

Just because she didnt put the money in her own bank account does not mean she didn't embezzle any funds.

My biggest issue is the income tax - The income tax withheld from employees – $261,388.09 – was not turned over to the state between July 4, 2009, and Jan. 1 of this year, one warrant alleged.

Any person who runs a company with multiple employees, knows that income taxes withheld froman employees check must be paid to the state. You can't just take this money and reinvest it in your company. This is plain common sense.

IF it was invested back into the company.  That is an allegation by NC, they don't know 100% for sure that that $$$ wasn't paid out to other states if those employees worked in other states and are considered a "Qualifying Employee".

If the employees were working in a different state (salespeople for example), the income taxes wouldn't be owed to NC, they'd be owed to a different state alltogether or multiple states potentially.

Like I stated earlier, due to tax laws and such, things are VERY fuzzy when it comes to sales and income taxes.

Florida and South Dakota are 2 states that don't have income tax.  However, just becuase you are a resident there doesn't mean you don't owe taxes to another state (I could live in FL but work in CA, IA, OH, IN, and PA for a production company based in AZ (also has no income tax if I remember correctly).  I don't owe income tax in FL (but I do in all those other states and I have to file an income tax return for each and every one of them).  My employer (if not paying me on a 1099) has to pay in payroll taxes to those states on me as well.  If they are paying me on a 1099, they just have to report it to the state, they don't pay any payroll taxes on me.

Same goes for Sales Tax.  In Iowa you must have a building within the state in order to charge Sales Tax (so Amazon.com for example collects no sales tax in Iowa).  It would be against the law for them to collect Iowa Sales tax, but it is also illegal for them to collect sales tax for another state from me as well.  Therefore they could sell millions upon millions of $$$'s worth of product in Iowa and not owe sales tax to Iowa or (insert state here) because they cannot legally collect it.

When doing an audit, the state may only be looking at gross receipts and saying it doesn't add up and "jumped the gun" on arresting her (we won't know until it goes through the court system if it makes it that far).

One million dollars bond. She must be a flight risk? Wonder how much bond they put on a murder suspect, probably $25,000.

Seeing how Vande knows everything........

How did she get caught?

More than likely people filing state taxes in the state of NC, stated they paid in a certain amount of money (as reported on thier W-2, with a state employer ID #). The state of NC, never recieving this money started to question what was going on. 

Its a paperwwork trail. She got caught. Worst case, she gets 6 months in a country club prison.

Gobbledygook, is that you?

Their own accusation list says they allege they owe taxes, and until it all gets sorted out that's all it is, an allegatio.

If this were the IRS instead of the state of NC, the IRS seizes your assets (all $$ in the bank, house, business, other property) if you don't respond to the letters they send you in the mail (and even then it's at least a year long process).

NC and Carrabus county did no such thing....

Vande, I'm somewhat confused by your statement about personal income tax payments. By no means do I know tax code that great so my statement is based on what I know or think I know and could be wrong. My understanding though of your personal income tax is you pay that to the state you are a resident of. I live in ND on the border of MN. I work for a company that is based in WI. I do work for this company in ND and MN but I pay my personal state taxes to the state I am a resident of, which is ND. I am a salaried employee. Now the company I work for pays taxes to all of the states in which they do business in and profit. 

I live in ND but I could have a job with a Co. in MN and I would still pay my state taxes to my state of residence which in my case then would be ND, not MN and I know many people that do this since we live right on the border. 

http://gph.is/XMLGff

You people can defend her all you want.... a crook is a crook to me!

Most states tax codes make you pay taxes to the state in which the $$$ is earned, not your state of residence (if it was yoru state of residence, everyone would want to live in SD, FL or AZ as they have no income tax).  Some states make you pay income taxes on your earnings if you are a resident of the state (whether or not you earned it in their state or not) and you have to pay income taxes in the state in which the $$ is earned also (you are subject to the state where you earned the $$"s tax code whether or not you live there).

Salaried employees (depending on their job classification by the government) can be exempt to this rule if they qualify (not all do).

It's a convoluted system.  I am not considered a "qualifying employee" by goverment standards therefore even though the company I work for has locations in 9 states.  if I go work for a week in one of those other locations, I am liable for income tax in said state.  Therefore I don't have to travel or work at those locations.

"qualifying employees" (by Government standards) are typically salaried employees but not always and they generally can travel from location to location and not be subject to that states income taxes.

I know people that file income tax returns in 15-20 states every year as they are not "qualifying employees".  It's a big cluster and most people don't have any idea until they start getting notices in the mail (and the ones that ignore them get all their assets seized eventualy). 

About 15 years ago there was a big hubbub here in Iowa about people that lived in South Dakota but worked in Iowa and not paying income tax.  They were not filing income tax returns in Iowa because they didn't live here and didn't feel that they should have to pay them.  They lost in court and owed the tax.  Since then the tax laws have goten more and more confusing and hard to interpret by employers.

It doesn't look like the state jumped the gun - The charges against Butler resulted from an investigation by a special agent with the Department's Criminal Investigations Section in Raleigh.

Normally after an investigation, an arrest and an arraignment, bond is placed. Normally it isnt one million dollars if the evidence is weak or circumstantial.

And here is more - 

The company apparently was having other issues with its administration during then same time periods.

The Secretary of State’s Office shows Butler Specialties was formed Jan. 7, 1987.In 1992, iIt began regularly filing the annual reports required of corporations, and filed them through December 2002. Then they stopped.

The Department of Revenue issued a notice for the Secretary of State to put Butler Specialties on suspension as far as being a corporation in October 2009, the year DOR charged Butler began to not send in money withheld from employees.

DOR does not specifics when it lists a company for suspension, a spokesman for the Secretary of State’s Office said.

The Secretary of State took separate action, sending the company notices in March 2010 and April 2011 that it needed to get caught up on its reports.

The office dissolved Butler Specialties Inc. as a corporation on July 21, 2011.

Being dissolved does not mean an operation has to cease, but it does take away any legal protection that the owners got by creating a corporation, such as protecting their personal assets from any corporate creditors.

The state records show that the last person listed as the official registered agent of Butler Specialties Inc. was Brian J. Butler, with an address at the company’s business in Concord. He is not mentioned in the arrest warrants.

the department of revenue is much worse thatn the irs i believe....brutal..

Ascot was the greatest of all time..

West Capital wasn't half bad either..

Life is good...

If Geringer, (Chris) Luck (remember him?), and Rode can plead not guilty (which they have http://www.santacruzsentinel.com/weather/ci_23739022/court-date-set-men-accused-running-scotts-valley ) with good lawyers they will likely get off with little more than a slap on the hand I'm sure Jeannie Butler / Butlerbuilt can get decent enough lawyers to put this behind them as well.