A recent Department of Justice press release highlights the importance of employment tax compliance for business owners. A Pennsylvania man and woman were charged with conspiring to defraud the IRS and other tax crimes, including failing to pay employment taxes. If you have failed to comply with employment tax withholding or filing requirements, you should consider consulting with an experienced tax defense attorney to discuss your options to come into compliance.
Defendant Allegedly Defrauded IRS and Failed to Pay Over Withholding Taxes
The indictment, unsealed recently, reveals that from October 2013 to December 2021, Theodore Shearba and Jennifer Cemini of Perkiomenville, Pennsylvania, owned and operated a landscaping and excavation business. They are accused of attempting to defraud the IRS by not reporting income from their business, using business funds for personal expenses, not paying employment taxes, and changing business names and concealing income to avoid IRS efforts to collect unpaid taxes. Shearba is also alleged to have failed to file individual income tax returns for tax years 2019 through 2021.
If convicted, both Shearba and Cemini face a maximum penalty of five years in prison for the conspiracy count and each employment tax count. Shearba may also face a maximum penalty of one year in prison for each count of failing to file a tax return.
Coming Into Tax Compliance Before it is Too Late
Federal law requires that business owners and payroll administrators set aside taxes from employees’ paychecks, account for such withholding, and remit the funds to the government. Withholding from employees’ paychecks is the primary source of tax revenue and the Department of Justice and the IRS won’t hesitate to take action against anyone who is suspected of defrauding the system.
While complying with federal employment tax laws and regulations can sometimes be burdensome and confusing, business owners must remain vigilant in fulfilling their tax obligations to avoid the risks associated with noncompliance. If you have failed to properly follow federal employment tax laws or have received a notice that your business is being audited or investigated for employment tax compliance, it is in your best interest to contact an experienced tax defense lawyer to discuss your case.
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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Questions About Delinquent Payroll Taxes and Trust Fund Recovery Penalty
- What happens if an employer continues to incur new payroll tax liabilities?
- California Employment Taxes Basics
- How Does the IRS Develop an Employment Tax Fraud Case from the First Indication of Fraud to a Criminal Indictment?
- Can more than one person be considered responsible by IRS
- How unpaid employment tax payments are allocated
- When a corporate officer is considered a responsible party
- Examples of trust fund recovery penalty determinations
- Failing to pay employment taxes after notice is given
- How to determine responsible person for trust fund recovery
- Assessing trust fund recovery penalty and option to appeal
- What is the trust fund recovery penalty?
- What are the penalties for failure to pay employment taxes
- When am I considered liable for company’s employment taxes
