Former owner of Everett and Lynnwood restaurants sentenced to 10 months in prison for multi-year tax fraud
Seattle – The co-owner and financial manager of a Puyallup, Washington steel fabrication business was indicted today for nine counts of failing to pay over employment taxes, announced U.S. Attorney Nick Brown. Donna Powell, 56, co-owns and operates Pinnacle Steel Fabricators, a company that makes steel parts. Donna Powell serves as the Secretary/Treasurer and Accounting Manager for the business. The indictment alleges that between 2010 and 2018, the company withheld approximately $1,167,891 payroll taxes from employees’ paychecks, but failed to pay any of those funds over to the Internal Revenue System (IRS).
Powell will appear for an arraignment at 1:30 on February 14, 2022, at U.S. District Court in Tacoma.
According to the indictment, the company has 15-20 employees. Between 2010 and 2018, Powell withheld the employees’ share of employment taxes from their paychecks but failed to pay the withheld funds over to the government as required by law. Each quarter, Powell was required by law to file Forms 941 with the IRS disclosing the amount of payroll taxes withheld. Powell failed to file any Forms 941 for the period between 2010 and the first quarter of 2018. Instead of paying the taxes, Powell and her husband spent on personal interests such as travel ($32,000+), gambling at casinos ($41,000+), online gaming ($33,000+) and approximately $7,400 on spa and pool-related purchases.
Failure to pay over the taxes ultimately hurts the employees whose earning records are incomplete for Social Security, Medicare, and unemployment benefits. Employees can report concerns about federal withholding to the IRS and records can be corrected with documentation.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
Willful failure to pay over employment taxes is punishable by up to five years of imprisonment.
The case is being investigated by Internal Revenue Service Criminal Investigation (IRS:CI).
The case is being prosecuted by Assistant United States Attorney Seth Wilkinson.
Press contact for the U.S. Attorney’s Office is Communications Director Emily Langlie at (206) 553-4110 or Emily.Langlie@usdoj.gov.