A West Virginia man has been sentenced to three years in prison for failing to pay employment taxes withheld from his employees’ wages and for obstructing the IRS’ efforts to collect those taxes, the Department of Justice announced.
According to court documents and evidence presented in court, Christopher Jason Smyth operated Stat EMS LLC, an ambulance service in Pineville, from 2012 through part of 2017. Prior to founding Stat EMS, Smyth operated another ambulance business that accrued millions of dollars in employment tax liabilities before filing for bankruptcy. He then created Stat EMS under a nominee owner while continuing to run the business in the same manner as before.
As the operator of Stat EMS, Smyth was responsible for withholding Social Security, Medicare, and income taxes from employees’ wages and remitting them to the IRS. However, for years, he failed to fully pay those taxes. Instead, he diverted company funds to pay personal expenses and transferred money to businesses controlled by his friends and family. The IRS determined that Stat EMS accumulated approximately $3.3 million in unpaid taxes.
When the IRS assessed the unpaid taxes against Smyth personally and attempted to collect them, he engaged in deceptive conduct to evade payment. According to the Department of Justice, Smyth misled an IRS revenue officer by falsely claiming he had no personal bank accounts and did not use accounts belonging to others. In reality, he routinely deposited his paychecks into an account held in a relative’s name. He also denied involvement in several businesses, despite having signature authority over their bank accounts.
Following his conviction, Smyth was sentenced to three years in federal prison. The sentence underscores the consequences of failing to meet employment tax obligations and attempting to obstruct IRS enforcement actions.
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