United States Attorney Brendan V. Johnson announced that a Sioux Falls, South Dakota, man convicted of Willful Failure to Collect or Pay Over Tax from October 1, 2007, through December 31, 2007, was sentenced on June 9, 2014, by U.S. District Judge Karen E. Schreier.
Jared Adrian, age 46, was sentenced to 11 months of imprisonment, 1 year of supervised release, restitution in the amount of $357,542.70, and a $100 special assessment to the Federal Crime Victims Fund.
Adrian was indicted by a federal grand jury on December 3, 2013, for 15 counts of Willful Failure to Collect or Pay Over Tax, and 5 counts of Willful Failure to File Tax Return. On March 19, 2014, he pled guilty to one count of Willful Failure to Collect or Pay Over Tax.
“The sentence today should serve as a lesson to anyone thinking of evading their tax obligations,” said U.S. Attorney Brendan Johnson. “Not only will Jared Adrian have to pay everything he owes, plus penalties and interest, but now he’s a convicted felon serving a prison term.”
As part of his plea agreement, Adrian admitted that he owned and operated Jared Adrian Sod. Between April 2006 and April 2010, he avoided paying employment taxes by referring to his workers as “independent contractors” or “contract laborers” when in reality they were functioning as employees. This practice resulted in him willfully failing to account for and pay over employment taxes totaling more than $115,000. Also, Adrian admitted that for each year from 2005 to 2009, he failed to file personal income tax returns with the IRS, despite earning income. He admitted that he owes income taxes of $242,051, exclusive of penalties and interest.
“In today’s economic environment, it’s more important than ever that the American people feel confident that everyone is playing by the rules and paying the taxes they owe,” said Kelly R. Jackson, Internal Revenue Service (IRS) Criminal Investigation Special Agent in Charge. “Business owners, including Jared Adrian, have a responsibility to withhold income taxes for their employees and then remit those taxes to the IRS. This sentence should serve as a deterrent to those who might contemplate similar fraudulent actions.”
This case was investigated by the IRS. Assistant U.S. Attorneys Kevin Koliner and Ann Hoffman prosecuted the case.
Adrian is allowed to self-report to the U.S. Marshals Service no later than June 30, 2014.