A Jefferson County businessman has been sentenced to 18 months in prison after failing to pay employment taxes for 10 years. The verdict was issued by U.S. District Judge Zachary M. Bluestone, who also implied that it resulted in unpaid taxes totaling $774,081. The judge has also ordered him to pay back the taxes to the IRS as restitution and levied a fine of $18,684.
According to a press release from the United States Attorney’s Office, Eastern District of Missouri, the 54-year-old Danny L. Nickelson Jr. was the owner of General Physiotherapy. This company produced and sold massage and percussion equipment commonly used in medical treatment and physical therapy.
Danny L. Nickelson Jr. withheld Social Security and Medicare taxes and federal income taxes from employees’ pay but did not pay that to the IRS. https://t.co/IPZKNnIBui
— U.S. Attorney – Eastern Missouri (@USAO_EDMO) May 12, 2026
The news release states that from 2013 to 2022, Nickelson withheld Social Security, Medicare, and federal income taxes from employees’ paychecks but failed to send those payments to the IRS. It has also been claimed that he failed to pay the employers’ required matching share of those taxes.
Authorities claimed that he did the same at Tomichi Industries between 2013 and 2015. Tomichi Industries was a small plastic company that supplied products to General Physiotherapy. The 54-year-old was identified as the only shareholder of the company.
He used unpaid taxes to cover operating costs and personal expenses, including food, travel, shopping, and credit card payments. A sentencing memorandum by Assistant U.S. Attorney Jonathan Clow insisted that the businessman “put at risk his employees’ tax liabilities and future federal benefits.” It also stated he robbed “money from the U.S. tax system that funds the federal government and the social safety net.”
IRS Criminal Investigation investigated the case, while Assistant U.S. Attorney Jonathan Clow handled the case. Nickelson pleaded guilty in February to two charges related to failing to pay over trust fund taxes.
In other tax fraud news, James Phillips Scholten, 51, was sentenced to 20 months in prison. He evaded hundreds of thousands of dollars in taxes over more than a decade. According to Fox News, the Bryon Center man was sentenced by U.S. District Judge Jane M. Beckering. He has also been ordered to pay $868,707 in restitution to the IRS and to serve three years of probation after his prison term.
Federal prosecutors argued that Scholten intentionally hid over $13 million in income by selling stolen scrap material valued at nearly $3.4 million. The court documents suggest that he took high-value scrap metal from his employer, sold it, and kept the profits for himself.
Investigators claimed that Scholten intentionally hid records of his recycling earnings from his accountant to avoid paying taxes. Authorities said he reported owing only $2,465 in federal income taxes for 2021. He also failed to disclose an extra $610,818 in income from scrap metal sales. Prosecutors claimed the hidden income resulted in roughly $172,618 in unpaid taxes.
U.S. Attorney for the Western District of Michigan Timothy VerHey said, “Cheating on your taxes is not only illegal, but it is also not worth the risk.” He added that Scholten owed the government a large sum of money. VerHey warned that failure to pay would result in prison time.
