North Idaho bookkeeper convicted of grand theft, tax evasion

A Rathdrum bookkeeper could face prison time and must pay restitution for income tax evasion and grand theft related to funds embezzled from clients, according to a Thursday press release from the Idaho State Tax Commission.

The Kootenai County District Court sentenced Julia Dennett to five years in prison for tax evasion, and 10 years fixed and four years indeterminate for grand theft, the release said. 

In lieu of prison time, the judge retained jurisdiction over the case for a year while Dennett completes mandatory rehabilitation programs. 

The conviction also requires Dennett to pay restitution to her victims and the Idaho State Tax Commission.

Dennett owned an accounting firm that specialized in contract bookkeeping services. 

"She took advantage of a client’s trust by misappropriating their funds. She also took funds from a parent-teacher organization while volunteering as the treasurer," the release said. 

Dennett then failed to report the embezzled income totaling $59,155 on her 2022 Idaho income tax return, the release said.

“Illegal income is taxable in Idaho,” said Tax Commission Chairman Jeff McCray. “We’re committed to investigating all cases of tax fraud.”