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East Texas Lawyer Sentenced For Federal Employment Tax Violations

TYLER, Texas – The Eastern District of Texas sentenced a Tyler attorney to prison for federal employment tax violations, according to Acting U.S. Attorney Nicholas J. Ganjei.

John Bennett White, IV, 61, pleaded guilty on Feb. 1, 2021, to failure to pay employment taxes and was sentenced to 18 months in federal prison today by U.S. District Judge J. Campbell Barker.

“Although Mr. White withheld payroll taxes from his employees’ paychecks, he spent the money on himself rather than pay it forward to the government,” said Acting U.S. Attorney Nicholas J. Ganjei. “Mr. White also concealed assets in the names of other people and altered the law firm’s books to hide his fraud, all to the detriment of his honest, tax-paying, fellow Americans.”

According to court documents and statements made in court, White was an attorney and firm manager for a Tyler law firm, J. Bennett White, P.C. It was where White had significant control over the firm’s finances. For example, he had a duty to account for and pay the employment taxes on behalf of the firm’s employees to the IRS.

Between the second quarter of 2007 and the fourth quarter of 2015, White made sporadic and partial efforts to pay his firm’s employment tax liabilities. White withheld employment taxes from the law firm’s employees’ wages for multiple quarters during the same period but willfully failed to pay those trust fund taxes to the IRS fully. White filed Forms 941 reporting the law firm’s employment taxes for each of these quarters. He sent the IRS the total amount for 24 of those 38 quarters and made partial payments on ten occasions and no compensation for seven quarters. In total, White caused a tax loss of over $300,000. Instead of paying employment taxes, White paid other creditors and his expenses.

The IRS Criminal Investigation investigated the case, and Assistant U.S. Attorney Ryan Locker was the prosecutor.