A Maryland woman was sentenced today to one year and one day in prison for not paying employment taxes to the IRS and embezzling from an employee benefit plan.
According to court documents and statements made in court, Michelle Leach-Bard, of Lutherville-Timonium, was the owner and sole corporate officer of iProcess Online Inc., a third-party accounting company that specialized in payroll, human resources, and bookkeeping. From at least October 2016 through the end of 2021, she was responsible for withholding Social Security, Medicare, and income taxes from employees’ wages and paying those taxes to the IRS. Though the taxes were withheld, Leach-Bard did not pay them to the IRS as required.
In total, Leach-Bard caused a tax loss to the IRS of $2,663,264.12.
Additionally, iProcess had a Section 401(k) Profit Sharing and Retirement Plan for some of its employees. Contributions to the 401(k) Plan were deducted from participating employees’ wages. Beginning around 2007, Leach-Bard did not pay those employee contributions to the 401(k) Plan. In total, she did not pay approximately $207,180.41 in employee withholdings into the plan. Furthermore, Leach-Bard failed to make approximately $18,740.37 in employer matching contributions for certain employees.
In addition to her prison term, U.S. District Judge Stephanie A. Gallagher ordered Leach-Bard to serve two years of supervised release and pay $2,663,264.12 in restitution to the United States and approximately $207,180.41 in restitution to her former employees.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Erek L. Barron for the District of Maryland made the announcement.
IRS Criminal Investigation and the U.S. Department of Labor's Employee Benefits Security Administration investigated the case.
Trial Attorneys Catriona Coppler and Jeffrey McLellan of the Tax Division prosecuted it.