Information — United States v. Det Tran (D. Mass., Dkt. 1, filed 08/15/24)
Summary
This Information in Criminal No. 24cr10243 in the District of Massachusetts charges Det Tran with Counts One and Two, Failure to Collect and Pay Over Taxes (26 U.S.C. § 7202). It alleges that Tran owned and operated a temporary employment agency called HTP Temp, Inc. It alleges that from in or about 2018 through in or about 2021, Tran defrauded the IRS by misrepresenting the annual gross revenue HTP derived from customers and the actual wages HTP paid its employees. It alleges that Tran failed to disclose to the accountant more than $8 million in cash wages paid "off the books," and thereby evaded approximately $2,158,498.80 in employment taxes owed to the IRS.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“Information — United States v. Det Tran (D. Mass., Dkt. 1, filed 08/15/24).”
Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/court-filing-no-1-24-cr-10243-dkt-1-d-mass-39f5a55a6f/
, SHA-256 03ec83f8d1f622478d87cfe4964e45187744e2502652934a423ac7cf52a15a6a.Full text
Case 1:24-cr-10243-LTS Document 1 Filed 08/15/24 Page 1 of 6
UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
)
Criminal No. 24cr10243
UNITED STATES OF AMERICA )
) Violation:
v. )
) Counts One and Two:
DET TRAN, ) Failure to Collect and Pay Over Taxes
) (26 U.S.C. § 7202)
Defendant )
)
)
)
)
)
)
INFORMATION
At all times relevant to this Information:
General Allegations
1. The defendant, DET TRAN (“TRAN”), resided in Dorchester, Massachusetts.
2. TRAN owned and operated a temporary employment agency that operated under
the name HTP Temp, Inc. (“HTP”). HTP was a Massachusetts business with an address in
Dorchester, Massachusetts.
3. The term “temporary employment agency” refers to a business that provides
temporary workers to client companies, ordinarily on a short-term basis. The agency typically
handles the administrative and accounting tasks associated with the hiring and employment
process, while the client companies direct the day-to-day work activities of the temporary
employees.
4. In temporary employment agency arrangements, the agency is ordinarily
responsible for paying wages to the employees, for paying state and federal employment taxes,
Case 1:24-cr-10243-LTS Document 1 Filed 08/15/24 Page 2 of 6
and for processing payroll deductions for taxes, Social Security obligations, health care benefits
and union dues, if any. The agency is also responsible for meeting certain other fiduciary
responsibilities of employers, including maintaining workers’ compensation insurance for the
employees.
Federal Tax Requirement
5. The Internal Revenue Service (“IRS”) is an agency of the United States Department
of the Treasury responsible for administering and enforcing the tax laws of the United States.
6. TRAN operated HTP as an “S Corporation” for federal tax purposes. For federal
tax purposes, S Corporations pass corporate income (or losses) through to their shareholders, as
well as certain deductions and credits. HTP was required to report to the IRS each year its annual
gross receipts or sales, expenses, and resulting income or loss on a Form 1120S, U.S. Income Tax
Return for an S Corporation. HTP was not required to pay federal income taxes directly; instead,
the company’s income (or loss) was passed through to TRAN for tax purposes and reported on
TRAN’s Form 1040, U.S. Individual Income Tax Return (“Form 1040”).
7. As an employer, HTP was required to collect and pay over federal employment
taxes. Federal employment taxes consist of two parts: (a) employee income taxes withheld from
employee wages to be credited toward the employees’ federal income tax obligations, and (b)
Federal Insurance Contributions Act (“FICA”) taxes. FICA taxes consist of Social Security taxes
and Medicare taxes. For any given employee, one-half of the applicable FICA taxes is withheld
from the employee’s wages and the other half is paid by the employer. Federal tax law requires
employers to account for, collect, and pay over to the IRS both the withheld taxes (i.e., the
2
Case 1:24-cr-10243-LTS Document 1 Filed 08/15/24 Page 3 of 6
employee’s income tax withholdings and one-half of the FICA taxes) and the employment taxes
that the employer itself owes (i.e., the employer portion of the FICA taxes).
8. Employers are required to report all wages paid to employees and all federal
employment taxes on those wages on Form 941, the Employer’s Quarterly Federal Tax Return.
HTP was required to file Form 941 four times per year, for each quarter ending March 31, June
30, September 30, and December 31, and was required to pay over to the IRS the applicable federal
employment taxes on the same schedule.
The Tax Fraud Scheme
9. From in or about 2018 through in or about 2021, TRAN defrauded the IRS by
materially misrepresenting the annual gross revenue HTP derived from customers and the actual
wages HTP paid its employees.
10. TRAN accepted payments from HTP’s clients by check for services that HTP
provided. TRAN deposited some of these checks into a business bank account at TD Bank.
However, TRAN cashed most of the checks from HTP’s clients at a check casher in Worcester,
Massachusetts.
11. TRAN used the bulk of the cash proceeds to pay cash wages to employees “off the
books.” Some HTP employees were paid by check “on the books,” some by cash “off the books,”
and some by a combination of both.
12. TRAN also regularly deposited cash into his personal bank account.
13. TRAN provided his accountant with HTP’s business bank account records to
prepare the company’s annual Forms 1120, but intentionally failed to disclose to the accountant
the customer checks he had cashed, thereby causing the accountant to materially underreport the
3
Case 1:24-cr-10243-LTS Document 1 Filed 08/15/24 Page 4 of 6
company’s gross receipts and business expenses on HTP’s Forms 1120S for the calendar years
2018 through 2021.
Unreported Employee Wages
14. TRAN’s accountant prepared HTP’s weekly payroll and its quarterly Forms 941.
To prepare the weekly payroll, the accountant required that TRAN provide the identifying
information of HTP employees who worked each week, and the total wages HTP paid each
employee. Based on that information, the accountant provided payroll checks to HTP, and TRAN
distributed the checks to employees weekly.
15. Between in or about 2018 and in or about 2021, TRAN deliberately failed to
disclose to his accountant more than $8 million in cash wages he paid to HTP employees “off the
books”, thereby causing his accountant to prepare weekly paychecks that did not reflect the true
wages paid to HTP’s employees.
16. TRAN’s concealment of more than $8 million in “off the books” cash wages also
caused his accountant to prepare false quarterly Forms 941 for reporting HTP’s employee wages
and tax withholdings to the IRS between 2018 and 2021.
17. TRAN thereby evaded approximately $2,158,498.80 in employment taxes owed to
the IRS.
18. Additionally, in providing these false payroll records, TRAN caused his accountant
to file Forms 1120S for the tax years 2018 through 2021 that were materially false regarding HTP’s
business expenses.
4
Case 1:24-cr-10243-LTS Document 1 Filed 08/15/24 Page 5 of 6
COUNTS ONE AND TWO
Failure to Collect and Pay Over Taxes
(26 U.S.C. § 7202)
The United States Attorney charges:
19. The United States Attorney re-alleges and incorporates by reference paragraphs 1
through 18 of this Information.
20. Between on or about July 31, 2018 and on or about January 31, 2022, in the District
of Massachusetts and elsewhere, the defendant,
DET TRAN,
a person required to collect, account for, and pay over any tax, willfully failed to collect, account
for, and pay over to the Internal Revenue Service the federal income taxes required to be withheld
and the Federal Insurance Contributions Act taxes due and owing to the United States on behalf
of HTP Temp Inc., and its employees for the following quarters:
Count Filing Due Date Tax Year Form 941 and Quarter Approx. Tax Not Paid
Over
1 7/31/2018 2019 Form 941 2018 Q2 $75,479.51
2 1/31/2022 2021 Form 941 2021 Q4 $279,818.91
All in violation of Title 26, United State Code, Section 7202.
5
Case 1:24-cr-10243-LTS Document 1 Filed 08/15/24 Page 6 of 6
JOSHUA S. LEVY
Acting United States Attorney
By: /s/ Benjamin A. Saltzman
Benjamin A. Saltzman
Assistant U.S. Attorney
Date: August 15, 2022
6
File and source
- File
- 1.pdf
- Size
- 194,307 bytes
- SHA-256
- 03ec83f8d1f622478d87cfe4964e45187744e2502652934a423ac7cf52a15a6a
- Our copy
- 1.pdf
- Original
- No public link identified.