Michigan Businessman Found Guilty of Employment Tax Crimes

A federal jury convicted a Michigan businessman yesterday for not paying employment taxes and not filing his own individual income tax returns.

According to court documents and evidence presented at trial, Dale Thrush, of Farwell, owned and operated several automotive repair service locations and a gas station. Thrush was responsible for withholding Social Security, Medicare and income taxes from his employees’ wages and paying those funds over to the IRS on behalf of his employees. From October 2014 through December 2016, Thrush withheld those funds from his employees’ wages but did not pay over the full amount of the withheld taxes to the IRS. Instead, Thrush used some of those funds to pay personal expenses, including the remodeling and construction costs for his wife’s business.

In addition, Thrush did not file his own individual income tax returns for 2013 through 2016 despite being legally obligated to do so.

Thrush was convicted of three counts of willful failure to pay payroll taxes and four counts of willful failure to file individual income tax returns. He was acquitted of seven counts of willful failure to pay payroll taxes.

Thrush is scheduled to be sentenced on July 17. He faces a maximum penalty of five years in prison for each count of not paying employment taxes and a maximum penalty of one year in prison for each count of not filing his individual income tax returns. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Karen E. Kelly of the Justice Department’s Tax Division made the announcement.

IRS Criminal Investigation is investigating the case.

Trial Attorneys Mark McDonald and Evan Mulbry of the Tax Division are prosecuting the case.