St. Louis County Business Owner Pleads Guilty to Failing to Pay Over Employee Withholding Taxes and Failing to File Personal Tax Returns
For Immediate Release
U.S. Attorney's Office, Eastern District of Missouri
St. Louis, MO – Craig Gustafson, 45, of Grover, MO, pled guilty to twenty counts of failing to remit employee withholding taxes to the Internal Revenue Service, and four counts of failing to file personal income tax returns. Gustafson appeared today before U.S. District Judge Rodney Sippel who accepted his plea and set sentencing for June 5, 2020.
According to the plea agreement, Gustafson owned and operated Consumers Periodical Service of Missouri, Inc., a magazine subscription business in St. Louis County, Missouri. From 2013 through 2017, Gustafson withheld quarterly federal income and social security taxes from his employees, but failed to remit those taxes to the Internal Revenue Service as required. Gustafson issued annual W-2 forms to his employees which reflected the withheld taxes in order to lull those employees into believing that their withheld taxes had been properly remitted to the Internal Revenue Service. Further, for the tax years 2013 through 2016, Gustafson failed to file his own annual personal income tax forms and failed to pay personal income taxes owed to the Internal Revenue Service. During that period, Gustafson earned at least $670,400 from his company, and the tax loss to the United States from his failure to file tax forms and pay over required taxes was $131,296.
“Employers have a responsibility to their employees to withhold the proper amount of taxes and pay those taxes over to the IRS,” said IRS Criminal Investigation Special Agent in Charge Karl Stiften. “When employers fail to do so, it results in a loss of revenue to the United States government, but more importantly, it could affect their employees’ Medicare and Social Security benefits.”
The failure to remit employee withholding taxes charges each carry a maximum possible penalty of five years imprisonment, a fine of $10,000 or both imprisonment and a fine. The failure to file annual tax forms charges each carry a maximum possible penalty of one year imprisonment, a fine of $25,000, or both imprisonment and a fine. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Internal Revenue Service, Criminal Investigation. Assistant United States Attorney Lindsay McClure-Hartman is handling the case for the United States Attorney’s Office.
Updated March 2, 2020