LUFKIN, TX (KTRE) -
A federal judge is denying a motion to dismiss the case against a former
Nacogdoches County commissioner and his wife, stating an indictment against
them does not exceed the statute of limitations.
Reggie and Deborah Cotton are under federal indictment, which alleges they
conspired to cover up their income from a cleaning service. Federal prosecutors
claim they failed to pay $97,000 in taxes.
Judge Ron Clark determined that evidence shows the indictment was filed
before the six-year statute of limitations.
According to a motion filed in federal court, the defendants argue the
statute of limitation, which is six years, bars prosecution in the case, as the
indictment was returned on June 20, 2012, but the tax returns were filed on
June 7, 2006.
In the government's response, they allege that the IRS began a civil audit
of the Cottons for their failure to file returns in 2003, 2004 and 2005. In May
or June 2006, Reggie Cotton called his accountant and reported he had received
a letter from the IRS and he wanted the accountant to prepare their returns.
Federal authorities interviewed the accountant in September. According to
the response, the accountant said signed the return on July 5, 2006 and Cotton
provided a signature on June 6, 2006. The accountant said it was impossible for
Cotton to sign the return before he had it printed.
For the 2004 return, the document alleges someone changed the date on the
return.
The document further alleges that Deborah Cotton did not report a personal
business to the IRS and in an interview in April 2008, she tried to tell the
accountant that she told him about the business but the accountant flatly
denied the clam.
The document further explains that the statute of limitations is not
exceeded because it is the date in which the returns are filed that the statute
begins, not when the returns are signed.
In Clark's ruling, he stated the date on which the statute of limitations
begins to run is the date the IRS received the return.
The Cottons are scheduled to go to trial on Nov. 8.
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