Brooklyn Businessman Pleads Guilty to Failing to Pay Over Employment Taxes
Failed to Collect and Pay Employment Taxes for 17 Consecutive Quarters
A Brooklyn, New York, businessman pleaded guilty today to failing to collect, truthfully account for, and pay over employment taxes, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
According to documents and information provided to the court, Zhi Hui Zheng owned and operated Good Time Sewing Inc. and Perfect Made Apparel Inc., which did business in Brooklyn. As the owner and operator of these businesses, Zheng was responsible for collecting, truthfully accounting for and paying over to the Internal Revenue Service (IRS) Social Security, Medicare and income taxes withheld from his employees’ wages. For seventeen consecutive quarters, beginning from the first quarter of 2012 and continuing through the first quarter of 2016, Zheng failed to collect and pay over the required employment taxes and failed to file the corresponding Forms 941 with the IRS. Zheng has admitted that he did not pay approximately $688,234 in employment taxes due to the IRS.
Sentencing is scheduled for Jan. 14, 2020, before U.S. District Court Judge Nicholas G. Garaufis. The defendant faces a statutory maximum sentence of five years in prison as well as a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorneys Mark Kotila and Christopher O’Donnell of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.