Tax Evasion by Pool Company Owner Who Failed to Pay Tax Withholdings

An Oklahoma businessman pleaded guilty to willfully failing to pay over to the IRS federal taxes that he withheld from his employees.

Theodore Michael Zachritz, of Nichols Hills, Okla., owned and operated Lifestyle Pools in Oklahoma City. As owner of the company, Zachritz deducted and withheld federal income taxes, Social Security taxes, and Medicare taxes (commonly called “payroll taxes”) from wages of Lifestyle Pools employees. Under federal law, an employer must deduct and withhold payroll taxes from employees’ wages, and then pay those withheld taxes to the IRS at the end of each quarter.

The U.S. government charged Zachritz with failing to collect and pay over to the IRS the federal taxes withheld from wages of Lifestyle Pools employees for the third quarter of 2006 through the end of 2009.

During a plea hearing, Zachritz admitted that he deducted and withheld more than $290,000 in payroll taxes from his employees’ wages during that period. He also admitted that he knew he was required by law to turn over to the IRS the withheld federal payroll taxes each quarter, but he did not do so.

He faces up to five years in prison and a fine up to $250,000.

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