Steven Kolb, 59, of Springdale, was sentenced to 21 months in federal prison for willfully failing to pay withholding taxes to the federal government. Kolb was also sentenced to three years of supervised release, and a $2,500 fine.
U.S. District Judge Timothy Brooks also ordered Kolb to pay $117,455.36 in restitution to the Internal Revenue Service.
The announcement of Kolb’s sentencing came from the office of Conner Eldridge, United States Attorney for the Western District of Arkansas, and Christopher A. Henry, Special Agent in Charge, IRS Criminal Investigation, Nashville Field Office.
“When employers withhold taxes from paychecks and do not remit those funds to the government, they are breaching the trust of their hard-working employees,” Eldridge said in a statement. “This is also an affront to the vast majority of employers that handle employee withholdings in an appropriate manner. This defendant has now been held accountable for his conduct in this regard.”
According to court records, from 2004 through 2010, Kolb and his wife owned a granite/stone installation business which they opened under the name Stone Art Designs, LLC. Stone Art Designs was required to make deposits of the payroll taxes to the IRS on a periodic basis. In addition, it was required to file, following the end of each calendar quarter, an Employer's Quarterly Federal Income Tax Return (Form 941), setting forth the total amount of tax withheld, the total amount of Social Security and Medicare taxes due, and the total tax deposits.
Although Kolb filed delinquent Forms 941 for Stone Art Designs, and withheld payroll taxes from employee paychecks for the tax quarters in years 2005 through 2007, he failed to pay over those taxes to the IRS. Altogether, Kolb failed to pay over $117,455.35 in payroll taxes which included the taxes withheld from employee paychecks and the portion of taxes that Stone Art Designs was required to match and pay over to the IRS.
On July 1, 2013, Kolb pleaded guilty to one count of Willful Failure to Collect or Pay Over Tax. The case was investigated by IRS-Criminal Investigation. First Assistant United States Attorney Wendy Johnson prosecuted the case for the United States.