Man Sentenced For Failure To Pay Employee Tax Withholding

ST. PAUL, Minn. (WCCO) – A Shakopee businessman has been sentenced Monday for failing to pay federal income taxes withheld from workers.

According to the U.S. Department of Justice, Stephen Paul Clough was sentenced to three years’ probation, four months of community confinement, and a $25,000 fine for one count of willful failure to pay over tax.

Clough was one of the former owners of Shakopee‘s Gamma Vacuum, and was solely responsible for Gamma Vacuum’s bookkeeping, including the withholding and payment of payroll taxes.

From 2003-2010, Clough failed to pay the Internal Revenue Service appropriate income and employment taxes withheld from the wages of the employees at the company.

Clough used the funds to pay company expenses, costing the IRS $944,134.29. He was charged on April 27, 2012, and pleaded guilty on May 7, 2012.

Gamma Vacuum manufactures pumps and related products.

The case, the result of an investigation by the IRS-Criminal Investigation Division, was prosecuted by Assistant U.S. Attorney William J. Otteson.

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