Paying taxes is often unavoidable, especially for business owners. In fact, someone who runs a Connecticut business likely has numerous taxes to pay, including state employment taxes, income taxes and federal unemployment taxes. While it may be tempting to hold back taxes and claim them as profits, business owners who do so are subject to heavy penalties if the government catches up with them. Two restaurant owners are currently facing criminal charges for tax evasion and other accusations.
Apparently, the U.S. Department of Labor obtained information that a husband and wife who own a chain of sushi restaurants in another state had not paid their employees according to state law. The DOL notified the county's district attorney that the restauranteurs allegedly paid their workers with cash to avoid paying payroll taxes. The district attorney's office that filed the charges claims the couple owes over $1 million in payroll taxes and close to $270,000 in back wages for underpaying their workers.
Records show that the couple owns four restaurants serving Korean food and sushi, and they employ 28 people, both full and part-time. The DOL claims those employees failed to receive adequate wages for the hours they worked during a recent three-year period. After pulling payroll tax records to investigate the claims of wage theft, authorities filed charges of state tax evasion and fraud.
These charges carry significant penalties if a court convicts the accused. State and federal governments have a history of success when pursuing these matters, and those in Connecticut who stand accused of tax evasion or other tax crimes should know they have a difficult road ahead. Seeking legal advice as soon as possible after learning that one is under investigation often improves the chances of a more positive outcome.