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Specializing in IRS and NYS Tax Representation. Workers Compensation Audits, Payroll, Sales and Income Tax representation for Businesses, Individuals, Restaurants and Construction Companies. Civil and Criminal Workers Comp Audit representation includes: NYSIF Examinations, Premium Disputes, Employee Misclassification, Underreporting, Unreported Income, and Failure to Keep Accurate Payroll Records.

Tuesday, November 26, 2019

Owner of Long Island Painting Company Sentenced to Prison for Tax Evasion

Evaded Over $1 Million in Income and Employment Taxes A Long Island, New York, business owner was sentenced to 12 months and one day in prison today for tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.According to documents filed in this case and statements made in court, Warren J. Krotz, 62, of Huntington, New York, owned and operated W. Krotz Enterprises Inc. (WKEI), a professional painting business that provided services throughout Long Island. From 2010 through 2016, Krotz evaded both his individual income and employment tax liabilities. During this time, Krotz cashed approximately $6 million in checks at several check-cashing facilities. These checks were gross receipts of WKEI, but Krotz did not report the amounts on WKEI’s corporate income tax returns. Krotz also paid approximately $2 million in cash wages to employees, and did not withhold and pay over to the Internal Revenue Service (IRS) approximately $300,000 in employment taxes that were due.Additionally, Krotz admitted to receiving approximately $3 million in income that he did not report on his personal tax returns. In total, Krotz admitted to causing a tax loss to the IRS of approximately one million dollars.In addition to the prison term, U.S. District Judge Denis R. Hurley sentenced Krotz to serve three years of supervised release and to pay restitution of $1,031,633 to the IRS.Principal Deputy Assistant Attorney General Zuckerman commended special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorneys Jessica Moran and Kathryn Sparks of the Tax Division, who are prosecuting this case.

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