Software Company Owner Gets Prison Sentence for Failing to Pay IRS More than $2.2M in Payroll Taxes

PITTSBURGH -A resident of Allegheny County, Pennsylvania, has been sentenced in federal court to 2 years (24 months) in prison, restitution payable to the Internal Revenue Service in the amount of $2,285,807.70 and one year of supervised release on his conviction of willfully failing to pay over payroll taxes, United States Attorney Scott W. Brady announced today.

Senior United States District Judge Donetta Ambrose imposed sentence on Amarender Tiparthy, 50, of Coraopolis, PA.

In connection with sentencing, the court was advised that Tiparthy willfully failed to account for and pay over payroll taxes totaling $2,285,807.70, including all relevant conduct, for the 16 tax quarters in 2010 through 2013.

According to information provided the court, Tiparthy was the sole owner of Prodigy Software Group, Inc. (“Prodigy”), a Subchapter S business that provided companies and governmental entities with consulting services regarding information technology projects. The business model of Prodigy included the employment of individuals who then were assigned to various information technology projects pursuant to contracts negotiated and entered into by Tiparthy on behalf of Prodigy. Although Tiparthy collected payroll taxes for the 16 tax quarters in 2010 through 2013, he failed to truthfully account for and pay over the taxes when due to the Internal Revenue Service.

Assistant United States Attorney Mary McKeen Houghton prosecuted the case on behalf of the government.

The Internal Revenue Service, Criminal Investigation, conducted the investigation leading to the conviction in this case.