Tommy Michael VanHoose has signed a plea deal with federal prosecutors in a tax evasion case.
In the agreement, filed on Oct. 2, VanHoose agrees to plead guilty to one count of filing a false income tax return and to restitution of $250,000.
Prosecutors agree to dismiss the other four counts of filing false tax returns.
His change of plea hearing has been set for Oct. 23.
The parties may make other arguments for punishment at the time of sentencing, according to the agreement.
Gun shop owner appears in federal court; trial set for Nov. 19 [2024]
The owner of Highwood Creek Outfitters was charged in 2024 with five counts of filing false income tax returns, underreporting income by about $1.4 million.
If convicted, VanHoose faces a maximum of three years in prison, a $250,000 fine, and one year of supervised release on each count, according to the U.S. Attorney’s Office.
“The indictment alleges VanHoose, by his own claims, skimmed cash from his firearms business and did not report 20 percent of his gross receipts to the IRS, which resulted in a substantial underpayment of income taxes to the United States. After a thorough investigation conducted by the IRS, we allege VanHoose’s own statements to an undercover agent were accurate, which is why he is charged with multiple counts of submitting a false federal tax return,” U.S. Attorney Jesse Laslovich said said in a release.
During the summer of 2023, federal agents raided the gun shop, causing an uproar in Great Falls and frustration for local law enforcement agencies who were asked to assist with limited information.
Great Falls gun shop owner charged in federal court [2024]
Both of Montana’s senators at the time asked federal agencies for more information over the following year in letters and hearings.
According to court documents, VanHoose owned and operated Highwood Creek Outfitters LLC, a firearms distributor and shooting range in Great Falls. VanHoose, through a real estate agent, listed the business for sale for $1,750,000. An IRS undercover agent, posing as a potential buyer, inquired about the list price by calling the real estate agent in February 2023. The real estate agent told the undercover that, “[n]ot everything flows to the tax returns.” In a later conversation, the real estate agent told the undercover that they would not identify in writing any “off the books” income but the actual amount of income was “substantial,” according to court documents.
The undercover toured Highwood Creek Outfitters with VanHoose in May 2023 and during the tour, VanHoose stated that he skimmed approximately $450,000 in cash and repeatedly stated he did not report 20 percent of the gross receipts to the IRS, according to the indictment.
Based on VanHoose’s claims and records obtained through a search warrant, VanHoose underreported about 20 percent, or about $1,486,404, of his income for tax years 2018 through 2022, resulting in him owing the IRS about $492,254,” according to charging documents.
The indictment alleges that when individuals purchase firearms from Highwood Creek Outfitters, they are required to complete a Bureau of Alcohol, Tobacco, Firearms and Explosives Form 4473, which identifies the firearm purchased.
The undercover asked VanHoose how underreporting of income was possible when ATF tracked gun sales by serial number through ATF Form 4473s, to which VanHoose allegedly responded, “It’s easy,” according to the indictment.
VanHoose told the undercover agent, “they don’t know what I’m paying for or I’m getting in income off those guns,” according to the indictment.
“VanHoose therefore confirmed to the undercover that he accurately detailed sales through the ATF Form 4473 but underreported his income to the IRS. IRS agents executed a search warrant on June 14, 2023, at Highwood Creek Outfitters to obtain, among other items, the ATF Form 4473s to determine the amount of unreported income. The actual gun prices were attached to the ATF Form 4473s and confirmed that VanHoose skimmed cash and underreported his gross receipts to the IRS,” according to the U.S. Attorney’s office.
The indictment also alleges that VanHoose sold firearms for a higher price than what he entered into a point of sales system for the business; gave or sold firearms to others in which he did not record the transaction; and lied to his accountant by providing incomplete records to underreport income to the IRS, according to the U.S. Attorney’s Office.
After comparing VanHoose’s bank records with his point of sale system, agents found that his deposits were about $726,414 less than the cash sales recorded in the point of sale system.
Investigators also found that Vanhoose had distributed $572,462.64 in firearms for which no entries were made in the point of sale system.
The U.S. Attorney’s Office is prosecuting the case. IRS Criminal Investigation conducted the investigation.
