Omaha Businessman Sentenced for Failing to Pay Over Withholding Taxes
Chief United States District Court Judge Laurie Smith Camp sentenced Randall J. Thompson, age 65 of Omaha, Nebraska, upon his conviction for failing to pay over to the IRS the federal income taxes which had been withheld from his employees’ paychecks. Judge Smith Camp sentenced Thompson to six months imprisonment to be followed by three years of supervised release. Thompson was also ordered to pay restitution to the IRS in the amount of $95,505.42.
Thompson formed a company called American Medical Files, LLC (hereinafter referred to as “AMF”) in 2006. He served as the President and CEO of AMF from its inception through 2008. Thompson maintained control of AMF’s financial accounts and was the person responsible for paying over to the IRS the payroll taxes which had been withheld from AMF’s employees’ paychecks.
AMF was required to make deposits of the payroll taxes to the IRS on a periodic basis. In addition, AMF was required to file, following the end of each calendar quarter, an Employer’s Quarterly Federal Income Tax Return (Form 941) setting forth the total amount of wages and other compensation subject to withholding, the total amount of income tax withheld, the total amount of Social Security and Medicare taxes due, and the total tax deposits. Although the Form 941 was filed by AMF for the last quarter of 2007 and the first quarter of 2008, Thompson failed to pay over to the IRS the payroll taxes that had been withheld. The total amount that should have been paid for these two quarters was $95,505.42.
The investigation revealed that during the last quarter of 2007 and the first quarter of 2008, AMF took in approximately $775,000 and paid out approximately $982,000. The amount paid out by AMF included distributions to Thompson which far exceeded the amount of withholding taxes which should have been paid to the IRS.
“Business owners have a responsibility to withhold income taxes for their employees and then remit those taxes to the Internal Revenue Service,” said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation. “The failure to pay over withheld taxes results in lost tax revenue to the United States and the possible loss of future social security or Medicare benefits for the employees.”
This case was investigated by IRS Criminal Investigations.