A federal judge has sentenced an 80-year-old real estate businessman to 32 months in prison, saying Thomas E. Tilley of Chapel Hill obstructed the Internal Revenue Service in a tax investigation and ducked years of taxes.
Chief U.S. District Judge William L. Osteen Jr. also ordered Tilley to pay the IRS over $7.6 million in restitution and said Tilley would have a year of supervised release after he got out of prison.
Tilley had pleaded guilty last November to one count of trying to keep the federal tax code from being enforced. He was supposed to get “responsibility credit” that would reduce his jail time.
Osteen ruled Monday, however, that Tilley gave officials misleading information after entering his plea, and the judge canceled the deal for reduced time.
The U.S. Attorney’s office that prosecuted Tilley said the case went back to 1993 and ran at least through 2010. The government said Tilley sent the IRS misleading information, hid real estate transaction by using what prosecutors called “sham trusts” and filed false liens against his own properties in Orange and Durham counties to trip up IRS efforts to collect what agents said he owed.
Officials also said Tilley had not filed income tax returns for 1994 through 2013 while also saying in a 2009 financial statement that he had annual income of $822,000 and was worth $30 million.
Legal records show that Tilley and his wife, Iris, sued the government in 2002, asking to get back taxes paid in the early 1990’s.