Fair Lawn Man Who Ran Bergen County Shop Paid Staff In Cash To Evade Taxes: Feds

FAIR LAWN, NJ — A Bergen County body shop owner who paid his staff in cash admitted evading over $230,000 in income and payroll taxes, officials said Monday.

Kfir Baroan, 50, of Fair Lawn pleaded guilty on Thursday in federal court to tax evasion and willful failure to pay over payroll taxes, said the office of U.S. Attorney Robert Frazer.

Baroan earned "significant income" through his Elmwood Park auto body shop, and cashed more than $1.5 million in checks at check-cashing facilities from 2018 to 2021, officials said.

He used bank accounts associated with other businesses to deposit cash and withdraw funds, failing to accurately account for his revenues, according to officials and documents.

Baroan also paid his employees in cash, failed to report their wages to the IRS, and failed to withhold and pay various taxes.

He failed to file personal income tax returns in 2018, 2019, 2020, and 2021, the federal government said, even though he hired someone to prepare his 2018 and 2019 forms.

In total, he evaded over $233,000 in taxes between 2018 and 2021, officials said.

He was a Wayne resident at the time of the offenses, the documents state, but now lives in Fair Lawn.

The charge of income tax evasion carries a maximum penalty of five years in prison and a maximum fine of $250,000, or twice the gross gain or loss from the offense, whichever is greater. The charge of willful failure to pay over payroll taxes also carries a maximum penalty of five years in prison and a maximum fine of $250,000, or twice the gross gain or loss.

Baroan will be sentenced on Sept. 2, officials said.