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Former contractor gets probation for tax evasion

The owner of a now-defunct Marinette subcontracting company was sentenced to five years’ probation Monday for not paying thousands of dollars in federal taxes.

Joe Wilke, who owned the industrial pipefitting company HVAC-R of Marinette Inc., pleaded guilty in May to tax evasion. Eastern District of Wisconsin Chief Judge William Griesbach ordered Wilke to pay $108,178.14 to the Internal Revenue Service in restitution, as well as a $10,000 fine, according to court filings.

Griesbach, during a hearing in Green Bay, also sentenced Wilke to 90 days of home confinement.

Court records show that Assistant U.S. Attorney Matt Jacobs requested a prison sentence, while Wilke’s attorney asked for probation. However, Jacobs said Tuesday that Wilke took a second mortgage out on his home to pay the restitution, and that may have convinced the judge to not impose any prison time.

According to prosecutors, Wilke reported $62,118 in taxable income for himself and his wife in 2007. He reported they owed $15,232 in taxes.

But they made nearly double that amount and owed $37,064. Wilke, who prepared the taxes, did not count income from his other business, Kidz Ice, during that year.

“To conceal his operation of Kidz Ice, Wilke told his accountant that the bank account into which Wilke deposited receipts from Kidz Ice was dormant,” according to the plea agreement entered in May. “In addition, Wilke told his accountant that funds, which Wilke transferred from the Kidz Ice account to the operating account for HVAC-R, were personal funds.”

Wilke also underestimated his taxes in 2008 and 2009, bringing the total of his unpaid taxes to $51,000. But Jacobs said he agreed not to charge Wilke for the tax crimes in 2008 and 2009 if he pleaded guilty to the single tax evasion count and agreed to pay the IRS restitution, which also includes late fees and penalties.

Wilke did not immediately return a phone call Tuesday afternoon. He previously has said that his cousin’s husband, former HVAC-R employee Tim Garceau, notified the authorities, and that resulted in the IRS investigation and charges. Wilke has claimed Garceau knew about the incorrect bookkeeping but didn’t say anything.

Garceau has denied that allegation, but in a previous interview said he saw a lot of questionable activity in the three years he worked for Wilke.

Wilke shut down Kidz Ice, which delivered ice to gas stations and other businesses, two years ago, and shut down HVAC-R in March. He said money problems contributed to his shuttering the businesses.

A federal court on Oct. 22, 2013, ordered HVAC-R to pay$34,719.64, stemming from a lawsuit some former employees filed against Wilke in federal court for not paying into their pension fund. That judgement has not yet been paid, according to court records.

A similar suit was filed in July. When Wilke did not respond, a federal clerk of court entered default judgments against him and the company. According to a final order issued Tuesday, HVAC-R was ordered to pay the former employees $54,372.01 and Wilke personally was ordered to pay $2,213.57.

Michael Steinle, Wilke’s attorney in the tax case, did not immediately return a call Tuesday.


About Eric Heisig

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