Connecting the Dots–Major Boston Case of payroll tax evasion

Boston Cab Company owner charged in U.S. District Court with payroll tax evasion, employing illegal aliens and with failing to pay overtime wages. 

Tutunjian allegedly concealed the size of the company payroll from the IRS, and thereby concealed the amount of federal employment taxes he and EJT would be responsible for paying.  He did this by paying employees entirely or partially in cash and keeping such cash payments off the books.  By doing this, he ensured there would be no record of cash payments that could be inspected by the IRS.  Employees who were illegal aliens, and therefore not authorized to work in the United States, were allegedly paid entirely in cash.  EJT did not issue W-2 forms to those employees and did not withhold or pay federal income tax, Social Security tax, or Medicare tax with regard to those illegal alien employees.

ConnectPay recommends to all of our clients to secure appropriate I-9’s from all employees to assure that the workers are allowed to work in the United States.  Paying in cash to get around payroll taxes is obviously not a practice we recommend.  ConnectPay is here to help you understand your compliance requirements and identify if a worker is an employee or independent contractor.

The full text of the case is here

If you want a FREE REVIEW of your payroll procedures, information on identifying if a worker is an employee or independent contractor, understanding the new DOL overtime rules which go into effect on December 1, or anything else payroll related, don’t hesitate to contact me.

Mitch Zucker

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