MADISON - The president of a Monroe graphics company was sentenced Tuesday in federal court to two years in prison and placed on three years' supervised release for withholding employee taxes but not paying them to the IRS.
District Judge Barbara Crabb told Donald Penniston, 47, of Brodhead, that he just didn't make a mistake in failing to pay Canton Promotions, LTD's employees Social Security and Medicare taxes; instead he "lived a lavish lifestyle" while his employees lived on "only a fraction of his income.
"You deliberately took more to take vacations, to eat out and have more money than was rightfully yours ... taking it away from your employees and partners," she said.
Crabb noted Penniston's trip to Ireland in 2005, airline and water park tickets for his family and restaurant expenditures that he paid for from company funds should have been applied to Canton's tax liability that totals about $155,000 from 2004-06.
There is no record of Canton Promotions paying any federal taxes since 2001, which makes it likely that its liability exceeds the $155,000 Penniston has agreed to work on with the IRS, Crabb said.
A month after pleading guilty in February, Penniston paid about $12,000 in restitution, the amount he withheld from several employee in taxes that should have been paid to their retirement accounts.
Crabb's remarks came after Penniston said that he "knew I made a mistake and know there must be punishment."
He explained that in 1997, he and two friends started Canton Promotions and he assumed bookkeeping duties for which he wasn't trained for and "didn't do a very good job with it."
His attorney, Federal Defender Erika Bierma, said her client "eats and sleeps this business," and until now had no prior convictions, "not even a speeding ticket." She asked Crabb for a sentence of nine months of home confinement followed by supervised release to allow him to continue to work at Canton Promotions and reduce what it owes to the IRS.
"He faces prison time and losing his business ... He wants to keep his employees in Monroe, Wis. employed, a place without an abundance of jobs," Bierma said.
After court, Assistant U.S. Attorney Laura Prbyzylinski Finn said Penniston was caught by a program where the IRS cross checks what businesses report as income and contributions with records kept by other agencies including Social Security Administration and the states.
After some discrepancies were discovered in 2006, the IRS began investigating. Initially, Penniston said he didn't understand he had to pay employee taxes and then admitted he knew that he had withheld the funds but hadn't paid them to the IRS.
Crabb ordered Penniston to report to prison by July 18.
District Judge Barbara Crabb told Donald Penniston, 47, of Brodhead, that he just didn't make a mistake in failing to pay Canton Promotions, LTD's employees Social Security and Medicare taxes; instead he "lived a lavish lifestyle" while his employees lived on "only a fraction of his income.
"You deliberately took more to take vacations, to eat out and have more money than was rightfully yours ... taking it away from your employees and partners," she said.
Crabb noted Penniston's trip to Ireland in 2005, airline and water park tickets for his family and restaurant expenditures that he paid for from company funds should have been applied to Canton's tax liability that totals about $155,000 from 2004-06.
There is no record of Canton Promotions paying any federal taxes since 2001, which makes it likely that its liability exceeds the $155,000 Penniston has agreed to work on with the IRS, Crabb said.
A month after pleading guilty in February, Penniston paid about $12,000 in restitution, the amount he withheld from several employee in taxes that should have been paid to their retirement accounts.
Crabb's remarks came after Penniston said that he "knew I made a mistake and know there must be punishment."
He explained that in 1997, he and two friends started Canton Promotions and he assumed bookkeeping duties for which he wasn't trained for and "didn't do a very good job with it."
His attorney, Federal Defender Erika Bierma, said her client "eats and sleeps this business," and until now had no prior convictions, "not even a speeding ticket." She asked Crabb for a sentence of nine months of home confinement followed by supervised release to allow him to continue to work at Canton Promotions and reduce what it owes to the IRS.
"He faces prison time and losing his business ... He wants to keep his employees in Monroe, Wis. employed, a place without an abundance of jobs," Bierma said.
After court, Assistant U.S. Attorney Laura Prbyzylinski Finn said Penniston was caught by a program where the IRS cross checks what businesses report as income and contributions with records kept by other agencies including Social Security Administration and the states.
After some discrepancies were discovered in 2006, the IRS began investigating. Initially, Penniston said he didn't understand he had to pay employee taxes and then admitted he knew that he had withheld the funds but hadn't paid them to the IRS.
Crabb ordered Penniston to report to prison by July 18.