The manager for a chain of five California restaurants, which employed over 110 people, had significant control over finances for the group of restaurants.
As such, he had a responsibility to account for and pay IRS employment taxes on behalf of the company’s employees. In 2014 the manager instructed an outside payroll company to stop making employment tax payments to the IRS. From 2014 to 2017 the manager did not file employment tax returns, nor did he pay employment taxes. Instead, he paid other creditors and his own personal expenses.
In total, over $1.5 million was lost in tax revenue to the IRS. In addition to the 30-month prison term, the manager was ordered to serve one year of supervised release and to pay approximately $2.3 million in restitution to the IRS.