Arkansas Man Failed to Disclose Over $3 Million in Revenue.

In a significant tax fraud case, Carlos Gonzalez, a 59-year-old resident of Rogers, Arkansas, was sentenced to 20 months in prison for submitting fraudulent individual income tax returns. The court revealed that between 2014 and 2020, Gonzalez systematically understated the gross receipts from his tree-trimming and removal business, Charley’s Tree Service, resulting in a tax deficit exceeding $900,000 owed to the IRS.

The Scheme Uncovered

Court documents and testimonies indicate that Carlos Gonzalez cashed over $3 million in customer checks instead of depositing them into his business's bank account.

This deliberate action was particularly egregious as he was fully aware that his tax preparer relied on bank account records to prepare his tax returns. Moreover, he failed to disclose the cashed checks to his preparer, leading to significant underreporting of his business income.

As a result, the tax returns filed by Gonzalez's preparer reflected gross receipts that were far below the actual amounts, creating a substantial tax liability. The U.S. District Court Judge Timothy Brooks, presiding over the case in the Western District of Arkansas, characterized Gonzalez's actions as not only fraudulent but also damaging to the integrity of the tax system.

Consequences of Fraud

In addition to the prison sentence, U.S. District Court Judge Timothy Brooks ordered Carlos Gonzalez to complete one year of supervised release following his incarceration. He is also required to pay approximately $1.4 million in restitution to both the United States and the State of Arkansas, reflecting the gravity of his financial deception.

The announcement of the sentencing was made by Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, alongside U.S. Attorney David Clay Fowlkes for the Western District of Arkansas. Their statements underscored the commitment of federal authorities to combat tax fraud and ensure that individuals who engage in such criminal activities face appropriate consequences.

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