A federal judge on Monday sentenced a 56-year-old New Canaan man to one year in prison for tax evasion.
The man “formed and operated various entities, including Grey Brown, Inc. (a holding company for several restaurants operating under the name ‘Oaxaca Taqueria’), West Partners, Inc., and NY Cloud Kitchens, LLC,” according to a press release issued on behalf of U.S. Attorney Vanessa Roberts Avery of the District of Connecticut. “From approximately October 2013 through August 2023, [the man] willfully failed to disclose to the IRS significant income from his business and gifts from family members.”
He “owed $272,390.07 in back taxes, penalties, and interest” for the tax years 2011 through 2020, the release said.
The man, who has paid back the IRS in full, pleaded guilty in May 2023, it said. Released on bond, he’s required to report to prison in February.
Instead of paying his outstanding taxes, he “paid off personal and business debts, invested in a new business venture, and paid various personal expenses,” the release said.
“In evading his payment of taxes owed, [he] used financial accounts in the names of entities and other individuals rather than in his own name, paid personal expenses with corporate funds, and omitted significant assets on IRS forms,” it said.
He also failed to disclose receipt of an approximately $250,000 “Employee Retention Credit check” payable to Oaxaca Atlantic Avenue, LLC, it said.
“The Employee Retention Credit is a refundable tax credit for certain eligible businesses and tax-exempt organizations that had employees and were affected during the COVID-19 pandemic,” the press release said.
Sentenced Oct. 7 by U.S. District Judge Stefan R. Underhill in Bridgeport, the man will undergo two years of supervised release following a term of 12 months and one day in prison.
More information is available here.