A Union County contractor was arrested today for tax evasion and a judge in Newark ordered him held in jail.
.Joel Konopka, 45, of Elizabeth, New Jersey, is charged by indictment 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.
He appeared this afternoon before U.S. Magistrate Judge Jessica Stein Allen in Newark federal court and was detained.
According to U.S. Attorney Philip R. Sellinger, documents filed in this case and statements made in court, Konopka was the owner and sole shareholder of Konopka Construction Inc., a business that provided construction, contracting, and snow plowing services in northern New Jersey from 2014 through 2017.
Over a four-year period, his company, Konopka Construction, earned a minimum of $3.3 million, with over $1 million earned in 2016 alone but the defendant did not report this income accurately.
For 2014 and 2015, the filed corporate returns claimed zero income for Konopka Construction. For the subsequent years, 2016 and 2017, Konopka did not submit any corporate tax returns.
Throughout these years, no corporate tax payments were made to the IRS.
In a bid to conceal the company’s earnings, Konopka primarily operated with cash transactions and he cashed almost all of the checks – which amounted to hundreds of thousands of dollars annually – at check-cashing businesses in Essex and Ocean counties, thereby evading any trace.
Under the tax laws of the United States, Konopka was responsible for filing truthful and accurate corporate tax returns, Form 1120s, on behalf of Konopka Construction reporting all of the company’s income.
From 2014 through 2017, Konopka Construction realized business income of at least $3.3 million, including more than $1 million in 2016.
Konopka did not truthfully and accurately report that income, and instead falsely listed business income of $32,070, $33,682, and $35,778 for the years 2015, 2016, and 2017.
For tax years 2014 and 2015, Konopka filed corporate returns which reported no income for Konopka Construction for both years. For tax years 2016 and 2017, Konopka failed to file any corporate returns as required. From 2014 through 2017, Konopka caused no payments to be made to the IRS for any corporate tax.
Konopka disguised the income realized by Konopka Construction by operating almost exclusively in cash. Konopka received hundreds of checks annually made payable to Konopka Construction for services rendered totaling hundreds of thousands of dollars and cashed all but one check at check cashing businesses in Essex and Ocean counties.
The tax evasion allegations could lead to a maximum penalty of five years imprisonment and fines of up to $500,000 for each count.
The filing of false tax returns charges are punishable by a maximum penalty of three years in prison and a $500,000 maximum fine per count.
The failure to file tax return charges are punishable by a maximum of one year in prison and a $100,000 fine per count.