Friday, February 4, 2022

And Yet Another Criminal Prosecution for Failure to Pay Payroll Taxes

On September 1, 2021 we posted IRS CONTINUES to Criminally Prosecutes Employers For Failure To Pay Withheld Payroll Taxes - As Promised! where we discussed that we posted The IRS is Now Criminally Prosecuting Employers For Failure To Pay Withheld Payroll Taxes! where we discussed that the IRS is stepping up criminally prosecuting business owners for failing to turn over withheld payroll taxes and unlisted several other criminal prosecutions for failing to pay to the IRS withheld payroll taxes. On November 5, 2021 we posted Another Criminal Prosecution for Failure to Pay Payroll Taxes, where we discussed that a West Virginia woman pleaded guilty on November 4, 2021 to willfully failing to pay over to the IRS employment taxes withheld from employees’ wages.

Now according to the DoJ, a federal grand jury in Oakland, California, returned an indictment on February 3, 2022 charging a California businessman with failing to pay over employment taxes to the IRS.

According to the indictment, Larry Kudsk, of Berkeley, operated two construction businesses, M. Gutierrez Inc. and Larry Kudsk Construction Inc. For both companies, Kudsk allegedly was responsible for filing quarterly employment tax returns and collecting and paying to the IRS payroll taxes withheld from employees’ wages. Kudsk allegedly did not timely file employment tax returns, and did not pay withholdings to the IRS, for the last three quarters of 2015 for M. Gutierrez Inc., and for all four quarters of 2016 for Kudsk Construction Inc. In total, Kudsk allegedly caused a tax loss to the IRS of more than $250,000.

Kudsk is scheduled to make his initial court appearance on Feb. 11 before the U.S. District Court for the Northern District of California. 

If convicted, Kudsk faces a maximum of 5 (five) years in prison for each of the seven counts of failing to pay over employment taxes. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

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