Spooner Railroad Operator Receives Prison Sentence For Employment Tax Evasion

MADISON, WIS. – Timothy M. O’Shea, United States Attorney for the Western District of Wisconsin, announced that Gregory Vreeland, 55, Springbrook, Wisconsin, was sentenced yesterday by Chief U.S. District Judge James D. Peterson to one year and one day in federal prison for failure to pay employment taxes. Vreeland pleaded guilty to this charge on April 18, 2024. Vreeland paid $684,469 to the Internal Revenue Service (IRS) in unpaid taxes prior to entering a guilty plea in the case.

Vreeland owns and operates Wisconsin Great Northern Railroad, Inc. (the Railroad) which provides recreational train ride experiences, as well as rail car storage and rail switching services. Vreeland also co-owned and operated the Country House Motel and RV Park (the Motel) starting in August 2015. Both the Railroad and the Motel operated out of Spooner, Wisconsin.

The defendant served as the Railroad’s president and the Motel’s managing partner and was responsible for all aspects of the businesses, including among other things: signing checks, paying creditors, paying employees, signing and filing payroll taxes, making payroll tax deposits, and making banking deposits. Vreeland made the financial decisions for the Railroad and the Motel, including the filing of employment tax returns.

Vreeland failed to file employment tax forms for the Railroad from the fourth quarter of 2017 through all of 2021 and failed to pay over the associated employee withholdings for that same time period. Vreeland also failed to file employment tax forms for the Motel from the third quarter of 2015 through the third quarter of 2020 and failed to pay over the associated employee withholdings for that same time period. Vreeland used the employee withholdings to buy land and equipment to expand the Railroad’s operations, and to purchase a personal residence in Springbrook.

Vreeland was aware of his obligation to file employment tax forms and pay employment taxes because from 2014 to mid-2016, he received civil notices from the IRS for non-payment, which he initially ignored. Vreeland made no attempt to cooperate with the IRS until it began levying bank accounts.

At the sentencing hearing, Judge Peterson stated that Vreeland’s failure to pay employment taxes was a serious crime and was “part of a long-sustained pattern of criminal conduct.” Judge Peterson noted that the crime was aggravated by the fact that Vreeland had failed to pay over employment taxes from his businesses from 2014 - 2016 and then he engaged in the same conduct again starting in 2018. Judge Peterson also called Vreeland’s acts selfish and said the acts showed that Vreeland did not believe the tax laws applied to him.

The charge against Vreeland was a result of an investigation conducted by IRS Criminal Investigation. The prosecution of the case has been handled by Assistant U.S. Attorney Aaron Wegner.