Home / Crime and Justice / IRS Wins $371M Battle Against Convicted Tax Cheat
IRS Wins $371M Battle Against Convicted Tax Cheat
31 Mar
Summary
- Court allows IRS to collect $371 million in restitution immediately.
- Former tax lawyer Paul Daugerdas was convicted in 2013.
- Daugerdas oversaw fraudulent tax shelters costing $1.63 billion.
The 7th U.S. Circuit Court of Appeals has rejected Paul Daugerdas's latest legal attempt to challenge his conviction in a major U.S. criminal tax fraud case. This ruling, issued on March 30, 2026, permits the IRS to immediately collect $371 million in restitution from the former tax lawyer.
Daugerdas was found guilty by a New York federal jury in 2013 on multiple charges, including conspiracy, tax evasion, and mail fraud. He was convicted for his role in overseeing fraudulent tax shelters for approximately two decades, primarily during his time at Jenkens & Gilchrist, which resulted in over $1.63 billion in lost tax revenue for the U.S. government.
The appeals court affirmed that the U.S. tax code permits the IRS to impose its own restitution assessments against defendants like Daugerdas. Consequently, the $371 million penalty, equivalent to his criminal restitution amount, is now due immediately. This overrides the earlier sentencing order that stipulated monthly payments of 10% of his gross monthly income after his release from prison.
Daugerdas, who represented himself in his lawsuit against the IRS, was released from federal prison in December 2024. The IRS spokesperson declined to comment on the case.
