A Boerne, Texas woman, Belinda Jo Juarez, was sentenced to three years in prison for tax evasion and embezzlement of employee health insurance premiums.

Juarez, the majority owner and CEO of Superior Home Health Service, was found guilty of withholding insurance contributions from employee paychecks and failing to remit these payments to insurance providers, starting around August 2017.

Additionally, Juarez was convicted of willful failure to collect or pay over tax for withholding federal payroll tax contributions from her employees' paychecks and failing to remit these funds to the Internal Revenue Service (IRS) between 2016 and 2019.

As part of her sentence, Juarez was ordered to pay $617,738.65 in restitution to former employees and $3,667,098.88 in restitution to the IRS. She was also fined $20,000 and will serve three years of supervised release after her prison term.

The U.S. Attorney's Office for the Western District of Texas highlighted that Juarez did not inform her employees about some incurred medical costs, leaving them unaware that their insurance coverage had been canceled or was inactive.

Commentary

In the above matter, the person who stole the proceeds was the owner of the enterprise. The enterprise offered health insurance. Employees paid for all or part of the premium, the enterprise collected the premium and then the enterprise was expected to pay the health insurance provider to bind coverage.  

The owner instead stole the proceeds from her employees, which left them without coverage.  

In addition, the owner collected payroll taxes and failed to remit the taxes to the government.

Failing to remit collected payroll taxes to the government is a serious offense that can lead to significant penalties, both civil and criminal.

There are thousands of situations in which employees embezzle coworker payments meant for remittance creating exposure for themselves and their employers.

Here are just some of the civil, criminal, and other penalties associated with failing to remit tax payments to the IRS:

• Failure to Deposit Penalty: The IRS imposes a penalty for failing to deposit payroll taxes on time. This penalty can range from two percent to 15 percent of the unpaid tax, depending on how late the payment is:
  1. Two percent if one to five days late
  2. Five percent if six to 15 days late
  3. 10 percent if more than 15 days late
  4. 15 percent if not paid within 10 days after receiving the first IRS notice.
      

• Trust Fund Recovery Penalty (TFRP): This penalty is equal to 100 percent of the unpaid trust fund taxes. It can be assessed against any person who is responsible for collecting, accounting for, and paying these taxes and willfully fails to do so.

In addition to civil penalties, there are also criminal penalties:

• Willful Failure to Collect or Pay Over Tax (Sec. 7202): This is a felony offense punishable by up to five years in prison, a fine of up to $10,000, or both.
• Fraud and False Statements (Sec. 7206): Making false statements or fraudulent claims related to payroll taxes can result in up to three years in prison, a fine of up to $100,000 ($500,000 for corporations), or both.

Other losses are incurred as well:

• Interest on Unpaid Taxes: Interest accrues on any unpaid payroll taxes from the due date of the tax until the date of payment.
• Personal Liability: Individuals responsible for the company's payroll tax compliance can be held personally liable for the unpaid taxes and penalties.

The final takeaway is always remit, in full, any money collected from employees, including money for benefits and tax payments. Routinely audit to make sure remittances are made. Even a slight delay can lead to loss and possible criminal consequences.

Sources: https://www.ksat.com/news/local/2025/01/08/boerne-woman-sentenced-to-3-years-in-prison-for-tax-evasion-embezzlement-of-health-care-company/ and https://www.journalofaccountancy.com/issues/2014/jun/20149645/