Jeff Winick sued by IRS for not paying taxes
Feds say Winick owes nearly $10M
Jeff Winick, the founder and CEO of Winick Realty Group and one of New York’s top retail brokers, is being sued by the IRS for not paying his taxes.
In a complaint filed Monday, the IRS says that Winick underpaid taxes owed on approximately $23 million in income between 2012 and 2016, and avoided paying by renting and leasing his homes and cars and transferring assets to his daughter and other friends.
In September, Winick filed for Chapter 7 bankruptcy, which the IRS alleges was an attempt to avoid paying millions of dollars that he owes the agency “without sacrificing the luxuries and business interests he has obtained over the years.”
Among the expenses cited by the IRS in its lawsuit are a $17,000 per month apartment on 54th Street and a $15,000 per month home in Southampton; $18,000 per month for his daughter’s New York University tuition and living expenses; a boat, which he sold and then did not pay taxes on; and two Mercedes-Benzes.
In bankruptcy filings, Winick claimed to have $530,000 in assets and $9.7 million in back taxes and fines owed to the IRS — which says it holds 90 percent of his debt — and the New York State Department of Taxation and Finance. He declared $122,800 in monthly income.
The IRS alleges that before declaring bankruptcy, Winick transferred several of his assets to friends and family. For example, in 2016, Winick transferred a 74 percent interest in Winick Realty Group NJ, LLC — the New Jersey affiliate of Winick Realty — to a trust, with his daughter as beneficiary. He similarly lived out of residences in his daughter’s name and leased cars under the company’s name, per the complaint.
The lawsuit also accuses Winick of undervaluing assets. In his bankruptcy filings, Winick listed his 22.5 percent interest in Winick Realty and 60 percent interest in WTN (which the complaint notes is “an entity that has as its sole asset a 67.5% interest in Winick Realty”) as having “unknown” value. However, accountants and appraisers had conducted valuations of the firms in 2018, determining that Winick Realty was worth between $3.3 and $11.8 million.
He similarly listed the value of Rolex watches as $5,000, but Christi Sothers Fine Jewelry appraised them at $47,500.
Winick has previously agreed to pay back his debts to the IRS, but has defaulted on three separate agreements. Apart from his yearly withholdings, Winick has made approximately $2 millions in payments towards his 2012 through 2016 liabilities. That’s less than what he owed in 2012 alone.
Winick did not immediately respond to a request for comment.