A business owner in Tennessee received a one-year prison sentence and will pay more than $10 million to the government for his failure to pay employment taxes to the Internal Revenue Service (IRS). Principal Deputy Assistant Attorney General Caroline D. Ciraolo said of the conviction, “Payment of employment taxes is not optional.” She added, “Nor are such withholdings an interest-free source of money to be tapped to make payments on lavish personal expenses.  The sentence that Mr. Thornton received today reflects not just the harm that his actions caused to the U.S. Treasury but also the financial risks he placed on his employees by deliberately not filing their W-2 forms with Social Security on a timely basis.”
 
The Justice Department declared that 67-year-old Larry Thornton was the owner and CEO of Memphis-based Software Earnings, Inc. (SEI), and owner and CEO of First Touch Payment Solutions, LLC. DOJ said that he admitted that he was responsible for collecting, accounting for, and paying over to the IRS federal income taxes and Federal Insurance Contributions Act (FICA) taxes that were withheld from the wages of SEI and First Touch’s employees.
 
DOJ said that between 2007 and 2011, Thornton collected more than $6.8 million in employment taxes from SEI and First Touch employees’ paychecks, but did not pay those taxes over to the IRS, nor did he pay his companies’ matching share of FICA taxes. Thornton used the money for his own purposes. Thornton also failed to file personal and corporate income tax returns.  As part of the guilty plea, Thornton admitted that his illegal conduct caused a tax loss of more than $8.9 million to the IRS.
 
“Employment tax evasion results in the loss of tax revenue to the U.S. government and the loss of future social security or Medicare benefits for the employees,” said Special Agent in Charge Tracey D. Montaño of IRS Criminal Investigation (CI).  “Corporate executives like Mr. Thornton have a responsibility to withhold income taxes for their employees and then remit those taxes to the IRS,” said Montaño.


SHARE

Short Link

Spero News editor Martin Barillas is a former US diplomat, who also worked as a democracy advocate and election observer in Latin America. His first novel 'Shaken Earth', is available at Amazon.

Comments

RELATED NEWS