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Florida Men Plead Guilty to Payroll Tax Violations and Immigration Offenses

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    According to a Department of Justice press release, operators of a Florida staffing company recently pleaded guilty to tax and other federal charges after illegally employing several individuals who were not authorized to work in the United States and failing to properly withhold federal income taxes, Social Security, and Medicare from their pay. The story illustrates the consequences of failing to properly abide by federal payroll tax law. If you own a business or are responsible for the payroll function at a company, and believe that you are not in compliance with federal payroll tax requirements, it is in your best interest to consult with an experienced payroll tax defense attorney to determine your level of exposure and to develop a strategy to mitigate any year potential civil or criminal consequences.

    Defendants Encouraged Employees to Enter and Stay in the U.S. Illegally, Failed to Properly Withhold Taxes from Their Pay

    Court records reveal that Igor Kasyanenko, Mikus Berzins, and Roman Riabov were the owners and operators of Phoenix ADB Services Inc. Andrejs Kozlovs was an employee of the company between 2016 and 2020. Phoenix ADB Services Inc provided staffing to various hotels, restaurants, and bars in southern Florida as well as other locations. The employees provided to establishments by Phoenix ATV Services Inc. where not authorized to work in the United States. The defendants admitted to encouraging employees to enter the United States illegally and remain in the country in violation of federal immigration laws.

    When employees of Phoenix ADB Services Inc. were paid, they were done so without withholding of Social Security, Medicare, or income taxes. In fact, their wages went wholly unreported to the IRS. In addition to being charged with the failure to withhold payroll taxes from their employees, the defendants were also charged and plead guilty to various immigration offenses. Sentencing is scheduled for later this year. Each of the defendants face a maximum federal prison sentence of 5 years. The defendants may also be sentenced to serve a period of supervised release to commence upon the completion of their physical incarceration. Lastly, the defendants will likely be ordered to pay an amount of restitution, representing the amount of tax loss their illegal actions caused.

    Coming into Payroll Tax Compliance After Falling Behind

    While the facts in the story above involve both elements of tax and immigration law, taxpayers can be criminally investigated and prosecuted for merely failing to properly withhold taxes from employees who are lawfully permitted to work in the United States. As a reminder, federal tax law requires employers to withhold, account for, and pay over various types of taxes from the paychecks of employees. Willful failure to do so can result in severe civil and criminal penalties. If you suspect your business has failed to adequately comply with federal payroll tax requirements, it is in your best interest to seek guidance from an experienced tax attorney. Together, you will work to establish the pertinent facts of your case. Next, you will establish an agreed-upon strategy to mitigate the severe consequences of an IRS examination investigation or prosecution. While you are being represented by tax counsel, you will not have to go up against the IRS or Department of Justice alone.

    We Are Here for You

    Regardless of your business or estate needs, the professionals at the Tax Law Offices of David W. Klasing are here for you. We are open for business and our team will help ensure that your business is too. Contact the Law Offices of David W. Klasing today to discuss your business with one of our professionals.

    In addition to our main office in Irvine,  the Tax Law Offices of David W. Klasing has unstaffed (conference room only) satellite offices in Los Angeles, San Bernardino, Santa Barbara, Panorama City, Oxnard, San Diego, Bakersfield, San Jose, San Francisco, Oakland, Carlsbad and Sacramento.

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