Patricia A. Knish, age 43, and her husband, Steven A. Knish, age 45, both from Lonsdale, MN were both charged in a felony criminal Information with three counts of tax evasion for calendar years 1997, 1998, and 1999.

The Knishes owned Knish Construction Company, a Montgomery, MN based business that engaged in concrete highway construction and repair, as well as curb, gutter, and related work for commercial and private jobs.  In February 2000, Patricia and Steven Knish sold their interest in the company.

The criminal Information filed today alleges that Patricia and Steven Knish omitted approximately $1,990,000  in income from their joint federal personal income tax returns for calendar years 1996, 1997, 1998, and 1999, resulting in a tax loss of $810,000.   The Information alleges that Patricia and Steven Knish willfully underreported their income in each year by repeatedly obtaining, and not reporting as income to the IRS, various and numerous payments and reimbursements from customers and insurance companies in connection with their concrete construction business.  They also allegedly failed to report more than $200,000 in so-called “market recovery reimbursements” from certain union officials, which represented reimbursements for their company’s payment of union wages to their employees in jobs where non-union companies had competed for the same work.

During an audit of the construction company’s tax returns in January 2001, the Information alleges that Patricia Knish altered documents involving unreported income, which were provided to the IRS revenue agent.  The Information also alleges that Patricia Knish lied to IRS agents about the accuracy of the reporting of their income on personal tax returns filed for years 1996 - 1999.

During the time they were underreporting their income on tax documents, the Knishes built a lavish 5,000 square foot brick home on Lake Mazaska in Lonsdale, MN, which included an indoor swimming pool.  The criminal Information alleges that Patricia and Steven Knish wrote off more than $900,000 of what it cost to build their house through their company to evade substantial federal income tax.

Patricia and Steven Knish are scheduled to make their initial appearance on Friday, January 17, 2003 at 2:00 p.m. before Judge Donovan Frank in St. Paul.

Each count of tax evasion carries a maximum potential penalty of five years in prison and/or a $250,000 fine. Any sentences would be determined by a judge based on the federal sentencing guidelines.

The case is the result of an investigation by the Internal Revenue Service, Criminal Investigations and is being prosecuted by Assistant United States Attorney Hank Shea.

Criminal indictments are only charges and not evidence of guilt. A defendant is presumed to be innocent unless and until proven guilty.