Legal News

Taxes Make Me Ill: Paterson Aide Invokes Late Filing Syndrome

By Dionne Searcey

Charles J. O’Byrne, New York Gov. David Paterson’s top aide, invoked an unusual defense for his failure to pay income taxes or file returns from 2001 to 2005: late filing syndrome.

New York Gov. David Paterson, left, and Charles O’Byrne, chief of staff, talk in Albany, N.Y., July 29, 2008. (AP/Mike Groll, file)

According to the NYT, O’Byrne, who has an Ivy League education and a roughly six-figure annual salary, “could not bring himself to undertake the task of filling out his tax forms every year.” O’Byrne and his doctor have said he was clinically depressed back then. He’s being repped by tax lawyer Richard S. Kestenbaum.

The Times says the syndrome is not listed in the Diagnostic and Statistical Manual of Mental Disorders, and the American Psychiatric Association does not recognize it as a psychiatric condition.

However, the syndrome has been cited in several cases – many of them in New York - through the years in tax-evasion cases because it may shield defendants from criminal penalties. Tax experts say the IRS must demonstrate a voluntary and intentional decision not to file.

Way back in 1994, the Journal wrote (link unavailable) that the malady was being invoked amid an I.R.S. sweep of non-filers that included 50 New York law partners, some at the city’s leading firms. It also got a throat surgeon off the hook. New York attorney Robert Fink told the Journal the surgeon hadn’t filed federal income taxes in 10 years because of “an aversion to filling out forms.” The doctor’s office and personal records were also in general disarray, bolstering the claim. Eventually, the IRS dropped the criminal case.

Full post as published by Law Blog - WSJ.com on October 23, 2008 (boomark / email).