John Williams of St. Augustine pleaded guilty in federal court to failing to account for, and pay over to the Internal Revenue Service, income taxes, Medicare taxes and Social Security taxes (also known as payroll taxes) that were withheld from employees’ pay.
Williams, 63, faces a maximum penalty of five years in federal prison. A sentencing date has not been set, according to a Sept. 19 news release from the U.S. Department of Justice, Middle District of Florida.
The plea agreement indicates that in 2012, Williams became an owner, operator and a corporate officer of First Coast Exteriors Inc., a stucco application and homebuilding business.
He controlled the company’s financial affairs and almost all checks drawn on its corporate checking account, including paychecks, were signed by him.
The government said that as an owner and corporate officer with control of the company’s payroll and finances, Williams had a duty to collect payroll taxes from the taxable wages of his employees. Each quarter, he also had duties both to account for, and to pay over to the IRS, those payroll taxes.
Examination of Form W-2s filed for First Coast Exteriors employees showed that during the financial quarter ending March 31, 2013, through the quarter ending Dec. 31, 2018, First Coast Exteriors withheld payroll taxes from its employees’ wages.
IRS records show, however, that Williams did not account for the withholdings in Form 941 quarterly tax returns or pay the funds over to the IRS when the returns and payments were due.
Between 2013 and 2018, Williams’ actions resulted in unpaid payroll taxes of approximately $306,500.
During the same period, Williams also did not pay the IRS the employer’s matching share of Social Security and Medicare taxes, which totaled an additional $128,943, according to the Department of Justice.
First Coast Exteriors was not the only company that Williams operated that was delinquent in paying its payroll taxes.
Records show beginning in 1995, he operated a business called W.W. Contractors Inc. For the 13 financial quarters between 2009 and 2012, the company filed Form 941 quarterly returns, but only made partial or late payments of payroll taxes withheld and owed to the IRS, the release said.
“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,” Brian Payne, special agent in charge of the IRS-CI Tampa Field Office, said in the release.
The case was investigated by IRS – Criminal Investigation. It is being prosecuted by Assistant U.S. Attorney Michael J. Coolican.