CHARLESTON — A Parkersburg man was sentenced Thursday to two years in prison, to be followed by three years of supervised release, and ordered to pay $2,036,141.59 in restitution for tax evasion.
A release from the Justice Department said Brian E. Drake, 56, of Parkersburg, admitted to evading payroll and corporate income taxes while he was the owner and operator of River City Chem Dry (RCCD).
According to court documents and statements made in court, from at least 2008 and continuing through 2021, Drake owned and operated River City Chem Dry, which provided general building and specialty contracting services throughout West Virginia.
The release said Drake admitted that as an employer, he had a legal responsibility to collect and pay over to the IRS payroll taxes withheld from his employees’ wages and complete and file IRS Form 941. Drake further admitted that he knew that after he reorganized RCCD as a C corporation in 2012, he was required to pay corporate income taxes on earned income and complete and file IRS Form 1120 on behalf of RCCD every year, the release said.
It said beginning no later than 2005, Drake amassed a significant tax debt due to unpaid personal income taxes. Drake admitted that while his tax problems began as personal in nature, they later extended to RCCD, the release said. It said Drake’s tax delinquencies grew exponentially from 2005 through 2016, despite IRS attempts to collect his outstanding balances and work with him to help him attain compliance.
“The defendant has a long and repeated history of failing to pay personal and business taxes that has persisted from 2005 until now,” said United States Attorney Will Thompson in the release. “The transferring of assets and attempts to conceal income show that his actions were not a series of neglectful mistakes, but willful, intentional, and deliberate conduct. I commend the Internal Revenue Service for their investigative work in this case.”
The release said Drake admitted that he willfully evaded payment of $299,765 in payroll taxes, including federal taxes and the employer-due portion of Social Security and Medicare, for reported wages paid to RCCD employees from at least 2016 through 2019, and that he further admitted that he evaded the assessment of $347,054.87 in payroll taxes by routinely paying RCCD employees substantially in cash from at least 2017 and continuing through 2021. It said employees would receive paychecks reflecting a portion of their hourly wages and withheld taxes each payday along with envelopes containing cash for the hours they worked for which no federal taxes were withheld or paid over to the IRS.
The release said Drake also admitted that he failed to report money earned by RCCD for tax year 2016 and continuing through tax year 2021. It said Drake further admitted that he did not file corporate income tax returns for RCCD for tax years 2019, 2020, and 2021 to evade payment of corporate income taxes.
The $2,036,141.59 in court-ordered restitution reflects Drake’s unpaid taxes, interest, and penalties, the release said.
Understanding Lease Agreements
In other business news, the concept of a lease continues to be a cornerstone in both commercial and residential real estate markets. But what is a lease? A lease is a contractual agreement where one party (the lessor) grants another party (the lessee) the right to use an asset for a specified period in exchange for periodic payments. This lease definition encompasses various types of leases including property leases, equipment leases, and vehicle leases.
The lease meaning extends beyond just renting; it involves legal obligations for both parties. The lessor retains ownership of the asset while providing the lessee with exclusive use during the lease term. Understanding these terms is crucial for anyone entering into a lease agreement.
Whether you’re asking “what is a lease?” or seeking a deeper understanding of lease agreements, it’s essential to grasp the fundamental principles that govern these contracts. From ensuring compliance with payment schedules to understanding maintenance responsibilities, a well-drafted lease can provide clarity and security for both parties involved.
