Woodbury man charged with multiple counts of tax fraud in connection to Cottage Grove businesses

15 July 2023

A Woodbury businessman was charged with 13 felony tax crimes in relation to a landscaping business he owns and a haunted house business he operates, both located in Cottage Grove.

The Minnesota Department of Revenue announced Friday that the Washington County Attorney’s Office recently charged William Joseph Zywiec of Woodbury with eight felony counts of filing false or fraudulent sales tax returns, four felony counts of failing to file sales tax returns, and one felony count of failing to pay sales tax.

Zywiec owns and operate Zywiec Landscape and Garden Center, located in Cottage Grove, and also operates The Haunting Experience at the same property, which offers Halloween-related hayrides, a haunted house and a fall fest event, the complaint said. He does sales tax reporting and payments for both businesses.

The criminal complaint alleges that from March 2019 to March 2022, Zywiec “either filed sales tax returns he knew were false or failed to file sales tax returns altogether.”

He now allegedly owes more than $215,000 in taxes, penalties, and interest, according to the press release from the revenue department. The Washington County attorney’s office said each felony charge carries a maximum penalty of five years in prison, a $10,000 fine, or both.

Christopher Perske, an attorney representing Zywiec sent a statement Friday night disputing the allegations:

“As a family-owned business for over 40 years, Zywiec’s has proudly served its neighbors and community with quality garden products and great customer service,” Perske wrote. “We strongly deny all the allegations and believe there is a fundamental disagreement with the State of Minnesota as to Zywiec’s accurate sales tax obligation. It is shocking and disheartening that the taxing authority is choosing to use the strong-arm tactics of criminal charges to pursue a taxpayer who, by the Department’s own admission, has a history of correctly paying — even overpaying — the type of taxes in question.”

Perske wrote that he and his client look forward to challenging the allegations at “each and every point until the facts come to the public eye, and hope that this case will raise awareness and inspire change in how the Department of Revenue can better serve the people of Minnesota.”

According to the criminal complaint, Zywiec was told during an audit from 2009 to 2012 he had been underreporting sales taxes collected from the business and failing to remit the sales tax to the state. At the time, he was shown “how to correctly report and remit sales tax.”

But during a second audit, from 2015 to 2018, he refused to provide records or bank statements. The audit revealed the defendant was operating in March despite not filing,
In September 2021, investigators obtained bank and credit card records and served a search warrant at Zywiec’s home and businesses. During the search, more than $66,000 in cash — all in $100 bills — was found in a safe.

His first court appearance is scheduled for Aug. 16.

Zywiec could not be reached for comment Friday night.

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