Reno business owner Kyle Archie was sentenced to 10 months in federal prison yesterday for stealing employee tax withholdings from 2003 to 2009, dodging more than $1.2 million in employment taxes owed to the IRS. The hard-charging landscaper and rock hauling entrepreneur, co-owner of Reno Rock Inc., GKPA Inc., and D Rockeries Inc., admitted to collecting payroll taxes from workers’ wages—then funneling the funds elsewhere instead of sending them to the U.S. Treasury.
His mother, Linda Archie, who served as bookkeeper for the trio of companies, was handed five years’ probation and three months of home confinement for willful failure to file employment tax returns. Both Kyle and Linda Archie were ordered to pay restitution totaling $1,235,528. The IRS says the unpaid taxes spanned multiple years, with the most critical lapse occurring in the third quarter of 2008—when Kyle Archie simply stopped forwarding the withheld funds.
“The willful failure to comply with employment tax obligations is a crime – plain and simple,” declared Principal Deputy Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division. “Stealing employee withholdings and failing to pay them over to the U.S. Treasury gives dishonest employers an unfair advantage over their law-abiding competitors.” The message was clear: the feds are cracking down on bosses who treat payroll taxes like slush funds.
U.S. Attorney Daniel G. Bogden of the District of Nevada emphasized the human cost: “Defendants’ illegal conduct injured not only the United States, but their former employees.” Many workers were paid cash, and their unreported wages mean diminished Social Security and Medicare benefits down the line. “The United States will foot the bill,” Bogden said, “but the employees bear the long-term consequences.”
IRS-Criminal Investigation’s Special Agent in Charge Tara Sullivan put it bluntly: “Employers have a responsibility to their employees to withhold the proper amount of taxes and pay those taxes over to the IRS.” When they don’t, Sullivan noted, it doesn’t just hurt the government’s revenue—it guts worker safety nets like retirement and healthcare.
The case was investigated by IRS-Criminal Investigation and prosecuted by Assistant U.S. Attorney Carla B. Higginbotham and Trial Attorney Kathleen M. Barry of the Tax Division. Kyle Archie will also serve three years of supervised release following his prison term. The DOJ vows to keep targeting tax cheats who exploit workers and undermine the system.”
Related Federal Cases
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Key Facts
- State: Nevada
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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