Seattle Restaurant Owner Sentenced to Prison for $1.4 Million Payroll Tax Evasion
Ruadhri McCormick, owner and operator of the Capitol Hill eatery Single Shot, was sentenced Monday in U.S. District Court in Seattle to 13 months in prison and three years of supervised release for willfully failing to pay over more than $1.4 million in unemployment, Social Security, and Medicare taxes, Acting U.S. Attorney Charles Neil Floyd announced. Between 2014 and 2024, McCormick employed as many as 87 people, including servers, bartenders, and cooks, whose payroll taxes were withheld from their paychecks but kept by the owner rather than remitted to the Internal Revenue Service.
According to the U.S. Department of Justice, for at least thirty-six quarters over a decade, McCormick failed to remit $1,027,362 in payroll taxes withheld directly from employee earnings. He also neglected to pay the employer portions of Social Security, Medicare, and federal unemployment taxes exceeding $400,000, bringing the total tax loss to $1,446,341. McCormick admitted in his plea agreement that he did not file his personal income taxes for any tax year from 2015 through 2024.
The Breach of Trust and Personal Spending
During the sentencing hearing, U.S. District Judge Kimberly K. Evanson highlighted the severity of the financial crime. “This offense involves a significant breach of public trust,” Judge Evanson stated, pointing out that during the years taxes went unpaid, McCormick funded a home remodel, casino expenses, and travel.
Investigators from the Internal Revenue Service – Criminal Investigation (IRS-CI) uncovered that McCormick spent nearly $400,000 purchasing and remodeling a home on Vashon Island, nearly $125,000 on casino expenses, and more than $38,000 on travel. Assistant United States Attorney Lauren Staniar noted in her sentencing memo that McCormick made a conscious decision thirty-nine times not to pay quarterly taxes when they came due.
In her sentencing memo AUSA Staniar wrote, “McCormick failed to pay employment taxes for about a decade—from 2014 through 2024. This crime does not reflect a momentary lapse in judgment. Thirty-nine times McCormick’s quarterly taxes came due, and thirty-nine times he made the conscious decision not to pay them. McCormick also deprived his employees of money they earned as servers, bartenders, and cooks. McCormick withheld taxes from his employees’ paychecks, meaning he reduced their take-home pay by an amount he represented he would remit to the IRS on their behalf. In some sense, that money belonged to the employees’—McCormick was supposed to hold it in trust on their behalf and send it to the IRS for their benefits. But, instead of remitting the withheld amounts as promised, the money sat in Single Shot’s bank account, where McCormick spent it on himself.”
Impact on Employee Benefits and Future Credits
While the financial restitution of $1,446,341 is owed to the IRS, the immediate human toll falls squarely on the restaurant’s former staff. First Assistant U.S. Attorney Neil Floyd emphasized that employees bore the true cost of the offense. “Unfortunately, the employee’s Social Security work records now show gaps where they don’t have credit for the years they put in at McCormick’s restaurant,” Floyd explained. Because the withheld funds were never forwarded to federal accounts, workers face diminished retirement and federal benefit credits for the labor they performed.
Special Agent in Charge Carrie Nordyke of the IRS-CI Seattle Field Office echoed those concerns during the initial guilty plea proceedings covered by the IRS Criminal Investigation division. “Mr. McCormick’s employees trusted him with their tax withholdings. Little did they know that Mr. McCormick took advantage of this trust and kept over $1 million of these funds for himself,” Nordyke said.
McCormick Receives 13-Month Prison Sentence and Full Restitution
The case was thoroughly investigated by IRS-CI and prosecuted by Assistant United States Attorney Lauren Watts Staniar. Having entered a guilty plea earlier in the judicial process, McCormick faced up to five years in prison for willful failure to pay over tax. Prosecutors ultimately recommended a sentence of no more than 15 months, leading to Monday’s final federal prison term of 13 months alongside the full restitution order of $1,446,341.
