Senator Jim Justice, a Republican and former governor of West Virginia, agreed to pay only hours after the IRS filed a lawsuit to recover unpaid taxes from 2009.
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Mr. Justice, who was West Virginia’s governor from 2017 until he became a senator in January, entered politics after working in the coal industry, where his family business owned many mines across several states.
Senator Jim Justice, a Republican from West Virginia, and his wife have agreed to pay the IRS more than $5 million for unpaid taxes from 2009, ending part of a legal dispute he has said is politically driven.
The agreement, filed in federal court on Monday, came only hours after the IRS sued Mr. Justice and his wife, Cathy, accusing them of “neglecting or refusing to fully pay” their 2009 taxes. The IRS said that as of early August, the couple owed over $5.16 million in back taxes and interest.
Under the settlement, the Justices agreed to pay the full amount, plus any extra interest that builds up before they finish paying. The filing, made in the U.S. District Court for the Southern District of West Virginia, did not include a payment timeline. The deal, called a consent judgment, was still waiting for a judge to sign it as of Tuesday morning.
A spokesperson for Mr. Justice’s Senate office did not comment.
Last month, Mr. Justice claimed at a news conference that the 2009 tax bill against him and his wife — issued in 2015 — along with later assessments, were politically motivated. “If you don’t think these are political moves, you’re crazy,” he said. He hinted that President Joe Biden’s administration may have targeted him during his 2024 Senate run, but he provided no proof.
A spokeswoman for President Biden declined to respond to Mr. Justice’s accusations. Biden was president when newer assessments were issued, but he was vice president in 2015 when the original 2009 tax bill was created. He was no longer in office when the IRS filed tax lien notices earlier this year saying the Justices owed money for several tax years.
In 2009, Mr. Justice was a private businessman in the coal industry. He did not explain why he thought the Obama administration would have singled him out at that time. In 2015, he began his winning run for governor as a Democrat, six months after the IRS said he owed taxes for 2009. Four years later, after aligning himself with Donald Trump, he ran again and won as a Republican.
Mr. Justice also said he is demanding about $40 million in tax refunds from the IRS — a claim he made without evidence. He said he believes that in the end, he and his wife will “receive far more money from the IRS than what we owe them.” He added: “It’s just something we have to go through.”
Mr. Justice, who served as governor from 2017 until he became a senator in January, entered politics after spending many years running his family’s coal business, which owned dozens of mines in several states.
It was not immediately clear why the government reviewed and changed the Justices’ 2009 tax bill.
That same year, Mr. Justice sold one of his coal companies, Bluestone Coal, to Mechel — a Russian coal and steel company — for $436 million in cash plus shares. He has suggested that this deal may have led to an IRS audit. (He later bought Bluestone back six years afterward.) Also in 2009, he purchased the Greenbrier, a luxury West Virginia resort known for hosting retreats for Republican lawmakers.
Tax and debt issues have followed Mr. Justice in recent years. He and his companies have been accused of avoiding payments to banks and other creditors. Banks tried to take part of his governor’s salary, and he auctioned off several properties with overdue taxes. Last year, a federal judge in Delaware ordered him to sell six of his companies to settle other unpaid debts, according to West Virginia news reports.
His problems with the IRS may continue. The agreement reached on Monday only covers the 2009 tax year, but tax liens filed two months ago show that the government says the Justices owe money for three additional years. The liens, totaling more than $8 million, were recorded in a public database for Greenbrier County, West Virginia, and were previously reported by Politico.
One filing said the IRS first assessed the Justices’ 2009 taxes on Nov. 25, 2015, deciding at the time that they owed just over $3 million. It also said they owe nearly $5 million for 2017 and just under $11,000 for 2022. Another lien naming Mr. Justice alone stated he owed about $24,000 for 2017.
In comments to local news outlets last month, Mr. Justice argued that the IRS reached the $8 million total mostly through interest and penalties after an audit found that he “should have paid a few more dollars than what I paid” in 2009.
