A New Jersey contractor was arrested last week on charges of federal tax evasion.
Joel Konopka, 45, of Elizabeth, New Jersey, was charged with four counts of corporate tax evasion, two counts of filing false corporate tax returns, and two counts of failing to file corporate tax returns, according to a U.S. Department of Justice.
Konopka was the owner and sole shareholder of Konopka Construction, a company providing construction, contracting, and snow plowing services in northern New Jersey from 2014 to 2017.
According to court documents, Konopka allegedly failed to file truthful and accurate corporate tax returns for his company during that period, despite earning over $3.3 million in business income between 2014 and 2017, including more than $1 million in 2016,
Konopka did not report this income accurately. He filed corporate tax returns for 2014 and 2015 that reported no income for his company, and he failed to file any corporate tax returns for 2016 and 2017. Additionally, Konopka is accused of not making any payments to the IRS for corporate taxes during these years.
Konopka is alleged to have concealed the income earned by his company by predominantly operating in cash. He received numerous checks made payable to Konopka Construction for services rendered, totaling hundreds of thousands of dollars.
In 2016, for example, Konopka Construction was awarded an emergency contract to provide snowplowing services to the Township of Hillside and received approximately $388,000. However, he did not declare any of that money in corporate income.
Instead, according to tax returns filed on behalf of himself and his wife for 2015, 2016 and 2017, he falsely declared business income of $32,070, $33,682 and $35,778, respectively, primarily from Konopka Construction.
Konopka cashed checks he received on behalf of the business at various check-cashing businesses in Essex and Ocean counties.
If convicted, Konopka could face severe penalties, including a maximum potential prison sentence of five years and a maximum fine of $500,000 per count for tax evasion charges. Filing false tax returns charges could result in a maximum prison sentence of three years and a $500,000 maximum fine per count. Failing to file tax returns charges carry a maximum penalty of one year in prison and a $100,000 fine per count.
Konopka isn’t the only construction company owner accused of tax evasion.
In May, the owner of a New York construction company pleaded guilty in federal court last week to filing a false corporate tax return, concealing about $6.1 million in business income.
Pawel A. Bartoszek of Lake Grove, New York, admitted that from 2015 to 2017, he cashed checks he received from the clients of his business, Mega State, instead of depositing them into a corporate account, according to a U.S. Department of Justice press release.