A Lexington, Mo., business owner pleaded guilty in federal court to failing to pay over to the IRS more than $1.4 million in payroll taxes.
Randy K. Small, 50, of Lexington, waived his right to a grand jury and pleaded guilty before U.S. District Judge Gary A. Fenner to a federal information that charges him with failure to pay over to the IRS the payroll taxes of his employees.
Small is the owner of RSB Leasing, a transportation business that provides school bus service to multiple school districts in Missouri (including the Buchanan County R-IV School District, the Lexington, Mo., R-5 School District and the Hardin-Central C-2 School District). Small operated the business under three different names and failed to fully pay employment taxes for each of the three businesses, resulting in an aggregate tax loss of at least $1,457,483.
Small operated the business under the name Hill Transportation, Inc., from 2005 through February 2010. After accruing over $300,000 in employment tax liability, Small discontinued operations under Hill Transportation and began operating under the name SPYKE, LLC. After accruing over $1 million in employment tax liability, Small discontinued operations under SPYKE in 2012. Finally, Small operated under the name RSB Leasing which has continued to accrue tax liability.
Small admitted that he did not deposit the Federal Insurance Contributions Act and Medicare (FICA) taxes or the income taxes that he withheld from his employees’ wages, nor did he pay the employer portion of FICA.
While accruing employment tax liabilities, Small withdrew significant amounts of cash, purchased new buses and maintained a personal collection of cars. From 2009 through 2011, Small withdrew $286,052 from the business bank account in the form of cash and cashier’s checks payable to himself. Small spent an additional $147,000 to purchase new buses for the business.
Under federal statutes, Small is subject to a sentence of up to five years in federal prison without parole and must pay restitution to the IRS. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Brent Venneman. It was investigated by IRS-Criminal Investigation.
Several years ago, Randy Small – doing business as Hill Transportation Company contracted with the Trenton R-9 district to provide bus and student transportation which is now being handled by the Apple Bus Company.