David Neel, 63, a Chester man and the sole owner of several sleep disorder centers in central Virginia, including Siesta Health LLC, Healthy Sleep LLC, and Healthy Sleep Partners LLC, has been sentenced to two years in prison for willfully failing to account for and pay employment taxes. The U.S. Attorney’s Office for the Eastern District of Virginia announced the sentencing on [Date].
Between 2015 and 2020, Neel withheld federal trust fund taxes from his employees’ wages but did not report or pay these withholdings to the IRS. Instead, he used the funds for personal expenses, including paying for rent on a 215-acre horse farm, home renovations, life insurance, and other personal purchases.
The IRS requires employers to withhold federal income taxes, Social Security, and Medicare taxes from employees’ wages, known as trust fund taxes. Despite issuing W-2 forms showing he had withheld at least $311,985 in trust fund taxes, Neel failed to pay these funds to the IRS. In total, his unpaid tax obligation amounted to at least $460,543.
Additionally, Neel made no trust fund tax payments or filed IRS Form 941 for any of his companies from the first quarter of 2015 to the last quarter of 2020. The failure to pay both employee contributions and employer’s share of Medicare and Social Security taxes led to his conviction.
Neel’s actions, which also involved using company funds for personal expenses such as his significant other’s daughter’s tuition and a Ford F600 truck, resulted in his sentence. He is now facing the consequences of his deliberate neglect to meet his tax obligations.
