NJ Business Owner Sentenced for $10M Payroll Tax Evasion

Local Entrepreneur Faces Prison Time for Withholding Over $10 Million in Payroll Taxes

In a significant legal development, Ocean County businessman Josef Neuman has been sentenced to 30 months in prison for failing to remit more than $10 million in payroll taxes, a decision that underscores the federal government's resolve in prosecuting tax evasion. 

U.S. Attorney Philip R. Sellinger announced the sentencing, which took place today in Trenton federal court, highlighting the case's implications for both the legal and business communities in New Jersey.

Neuman, 37, from Lakewood, New Jersey, had earlier admitted to willfully neglecting his payroll tax obligations for one of his businesses in 2018, pleading guilty before U.S. District Judge Michael A. Shipp. 

The case documents and court statements reveal that Neuman, as CEO, managed a business offering administrative services to healthcare facilities, including roughly 20 entities he co-owned and operated. Despite being responsible for the financial management of these companies, Neuman neglected to forward the due payroll taxes to the IRS, choosing instead to cover other business costs and employee wages, thereby allowing the tax liabilities to accumulate throughout 2017 and 2018.

The court has also imposed two years of supervised release on Neuman post-incarceration and ordered him to pay $11.2 million in restitution, marking a significant penalty for the evasion of payroll taxes.

The IRS-Criminal Investigation division spearheaded the investigation under the direction of Acting Special Agent in Charge Jenifer L. Piovesan. Assistant U.S. Attorney Katherine Romano of the Health Care Fraud Unit in Newark represented the government.

This sentencing serves as a stark reminder to businesses and entrepreneurs across New Jersey about the importance of compliance with tax laws and the federal government's commitment to upholding fiscal responsibilities and integrity in the business sector.