Two Harbors businessman pleads guilty to tax charge

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A 46-year-old Two Harbors man admitted Friday that he failed to pay the Internal Revenue Service $367,640.52 in employment taxes.

Mark Fitzgerald, co-owner of Alliance Services, pleaded guilty in U.S. District Court in Minneapolis to one count of willful failure to pay taxes.

In his plea agreement, Fitzgerald admitted failing to report and pay over his employees’ federal employment tax withholdings to the IRS. Fitzgerald used $254,316.39 in withholdings to pay company expenses. In entering his plea, Fitzgerald also admitted failing to pay the IRS the employer’s share of employment taxes, which resulted in an additional tax loss of $113,324.13 for the IRS.

Allied Services performs landscaping, snowplowing, handyman work and home remodeling services. Fitzgerald owned the business with his wife from

2002 to 2006, and he was responsible for its bookkeeping, payroll and tax filings.

Fitzgerald faces a potential maximum penalty of five years in prison. A sentencing date hasn’t yet been scheduled.

Fitzgerald runs a saw mill and firewood business north of Two Harbors in Silver Creek Township. When reached by phone, he declined comment.

Mark and Rebecca Fitzgerald were listed last month in a mortgage foreclosure legal notice printed in the Lake County News-Chronicle. Their $1 million mortgage was recorded in 2004 and has an amount due of $927,158. The foreclosure notice has a sale date of Dec. 17.

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