FLORIDA — A contractor in St. Augustine could go to prison for up to five years because he didn’t pay the IRS the payroll taxes that were taken out of his workers’ paychecks.
Last week, John M. Williams, 63, pleaded guilty to not turning over to the Internal Revenue Service (IRS) the income taxes, Medicare taxes, and Social Security taxes (also called payroll taxes) that had been taken from his workers’ paychecks. The announcement was made by United States Attorney Roger B. Handberg.
Williams faces a maximum penalty of five years in federal prison. A sentencing date has not been set.
According to the plea deal, Williams became the owner, director, and corporate officer of First Coast Exteriors, Inc. in 2012. a stucco application and home-building business. He was said to oversee the company’s finances and signed almost all checks made on the company’s checking account, including paychecks.
The U.S. Attorney’s Office for the Middle District of Florida (USAO) said that as an owner and corporate officer in charge of the company’s payroll and finances, Williams had a duty to collect payroll taxes from the taxable wages of his employees.
The USAO said that he also had to account for and pay those payroll taxes to the IRS each quarter.
From the quarter that ended on March 31, 2013, to the quarter that ended on December 31, 2018, First Coast Exteriors took payroll taxes out of its employees’ paychecks. This was shown by an examination of the Forms W-2 that were filed for those employees.
The IRS said that its records show that Williams did not report these withholdings on Form 941 quarterly tax returns or pay these funds to the IRS when the returns and payments were due.
Prosecutors say that because of what Williams did between 2013 and 2018, about $306,500 in payroll taxes were not paid.
During the same period, Williams didn’t pay the IRS the employer’s share of Social Security and Medicare taxes, which reportedly added up to an extra $128,943.
The USAO said that First Coast Exteriors was not the only business Williams ran that owed payroll taxes but had not paid them. The USAO says he started a business in 1995 called W.W. Contractors, Inc. The USAO said that W.W. Contractors filed Form 941 quarterly returns for 13 quarters between 2009 and 2012, but they only paid part of the payroll taxes they owed the IRS or paid them late.
“Sadly, our agents investigate cases like these far too frequently,” said Brian Payne, special agent in charge of the IRS-CI Tampa Field Office.
“Business owners need to know that we will investigate tax cheats to ensure they are held accountable for their dishonorable actions. In this case, the defendant cheated both our federal tax system, and simply stole from his employees hard-earned employment benefits.”
This case was investigated by IRS – Criminal Investigation. It is being prosecuted by Assistant United States Attorney Michael J. Coolican.
