Local attorney speaks out about tax evasion case, what defendant is facing

A Bay City restaurant owner is accused of under-reporting his income and is now facing a federal charge of tax evasion.
Published: Jul. 16, 2022 at 4:53 PM EDT
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BAY CITY, Mich. (WNEM) - A Bay City restaurant owner is accused of under-reporting his income and is now facing a federal charge of tax evasion.

Prosecutors said 45-year-old Jose Costilla knowingly submitted a falsified return for the 2018 calendar year.

“This is something that is a frankly very rarely prosecuted,” said Nicholas Robinson, a criminal defense attorney. “There are 300 million people in America, 300 million people that should be paying taxes every single year. And believe it or not, there’s only about 2,000 of these prosecutions every single year.”

According to court documents, in May of 2019 Costilla submitted a 2018 individual tax return reporting an approximate total income of just over $39,000.

Prosecutors allege he knew he had a total income that was substantially greater.

“If we are talking an egregious situation, where somebody is doing something very bad with their taxes, that’s when things get referred to the prosecutor’s office. The IRS does not play, but they will get their money if you short them, and if you cheat them, they will use everything within their resources to come after that money,” Robinson said.

Robinson said if Costilla is found guilty, he could be forced to sell his properties and businesses to pay his taxes.

“It’s going to be hard to see how you can manage the business from the potential inside of a jail cell,” Robinson said.

Robinson said cases like this often come to the attention of the IRS because of a report from a disgruntled person.

“Former wives, former ex-girlfriends, former businesses associates where they actually pick up the phone and call that is actually more common than an IRS agent stumbling upon a discrepancy in a tax return,” Robinson said.