HUNTINGTON BEACH — State tax officials have raided the home and office of an Orange County business owner who has refused to withhold taxes from employee paychecks.
The state Franchise Tax Board agents seized financial and employment records, coins and tax-avoidance books from George Jesson’s Huntington Beach electronics business and Fountain Valley home on Wednesday.
According to a search warrant, Jesson is suspected of failing to withhold taxes from paychecks in 1997, 1998 and 1999. Jesson says he stopped withholding taxes only last year.
In media interviews, he has repeatedly said there is no law requiring he withhold taxes from employee paychecks. He also recently said he is refusing to pay his own income taxes.
“There’s nothing, absolutely no law, that applies to your personal wages,” Jesson was quoted in Friday’s Los Angeles Times.
State officials declined to comment.
Jesson and his No Time Delay Electronics are among two dozen businesses nationwide that publicly have defied government requirements that taxes be “paid as you go” through withholding, Social Security and other employment tax programs.
The names of the businesses surfaced in news reports last year. Federal and state tax officials have said they are investigating a small number of the withholding cases.
According to authorities, employers who fail to withhold taxes and turn them over may be required to pay up to double the taxes, plus interest, and can be prosecuted for felony tax evasion.
Jesson has said he wants the case to go to court so he can “expose the corruption of the system.” He said he believes in “lawful taxes,” such as sales, property, export, import, alcohol, tobacco, firearms and utility taxes.