DALLAS — A North Texas man is being forced to pay millions of dollars in restitution after withholding payroll taxes from employees' paychecks.
55-year-old Ronald James Paolucci of Frisco was sentenced to over four years in prison yesterday, according to the U.S. Attorney's Office Northern District of Texas. According to a release, Paolucci was the co-founder of American Management Staffing (AMS) in Frisco, Texas, a company that provided temporary staffing services to clients.
The release states Paolucci was employed by AMS from 2011 to 2020 and had control of the company's business affairs and bank accounts.
According to the release from the U.S. Attorney for the Northern District of Texas Leigha Simonton, Paolucci withheld around $13 million in payroll taxes from employees' paychecks from 2014 to 2020. Instead of paying that over to the IRS, Paolucci pocketed that money, the release says.
“We were proud to partner with IRS-CI on this important case,” said U.S. Attorney Leigha Simonton. “We stand ready to prosecute any employer who pockets employees’ payroll taxes and those who otherwise refuse to meet their tax obligations.”
According to court documents, Paolucci pleaded guilty to conspiracy to defraud the United States and making and subscribing a false tax return in Feb. 2023. He was sentenced Monday to 52 months in prison and will be forced to pay $38.9 million in restitution, per U.S. Attorney for the Northern District of Texas Leigha Simonton.
“Nearly 70% of total U.S. revenues collected by the IRS are collected through employment taxes," said Christopher J. Altemus Jr., Special Agent in Charge IRS Criminal Investigation, Dallas Field Office. "When the employer withholds the payroll taxes but fails to pay the taxes over to the IRS, they may be criminally investigated and prosecuted for failing to withhold, collect, and pay over the tax."
