SANTA ANA, California– A City of Orange tax return preparer has pleaded guilty in a scheme to defraud the Internal Revenue Service out of hundreds of thousands of dollars through the submission of fraudulent federal income tax returns for both himself and his clients.
Gilberto C. Gonzalez, 55, who operated under the name Gil Income Tax, pleaded guilty Monday before United States District Judge Andrew J. Guilford to one count of tax evasion, two counts of passing forged United States Treasury checks, and one count of unlawful procurement of naturalization.
According to a plea agreement filed in this case, during the years 2010 through 2012, Gonzalez prepared and filed with the IRS income tax returns for clients. But, after the returns were filed and without his clients’ knowledge, Gonzalez prepared and filed amended income tax returns that claimed a tax refund. In those amended returns, Gonzalez used his own home or business address, which caused the United States Treasury to mail the refund checks directly to Gonzalez. After waiting for some period of time, Gonzalez fraudulently endorsed the refund checks and deposited them into one of 11 bank accounts that he controlled.
Over a five-year period that began in January 2010, approximately 1,258 federal and state tax refund checks – worth more than $2.3 million and payable to individuals other than Gonzalez – were deposited into Gonzalez-controlled accounts.
Most of Gonzalez’s clients were Spanish speakers who had grown up in Mexico, according to the plea agreement, in which Gonzalez admitted that most of his clients could not read their income tax returns and had trusted him to properly prepare their tax returns.
In addition to defrauding the IRS by filing the amended tax returns, Gonzalez failed to report this income on his individual tax returns. For the tax years 2010 through 2012, Gonzalez failed to report more than $1.3 million in income, which caused the IRS to suffer tax losses of approximately $457,207, according to the plea agreement.
During the course of his tax fraud scheme, Gonzalez attempted to unlawfully procure United States citizenship by making false statements to U.S. Citizenship and Immigration Services. When he pleaded guilty, Gonzalez specifically admitted that he failed to disclose he had committed a crime by perpetrating his tax fraud scheme.
Gonzalez is scheduled to be sentenced by Judge Guilford on March 11, 2019, at which time he will face a statutory maximum penalty of 35 years in federal prison.
As part of his plea agreement, Gonzalez also agreed that he owes the IRS restitution totaling $975,183. Additionally, Gonzalez has agreed to forfeit to the government his interest in his residence, which was purchased with $652,324 that was primarily money fraudulently obtained from the IRS.
This case is the product of an investigation by IRS Criminal Investigation.
The case is being prosecuted by Assistant United States Attorney Daniel H. Ahn of the Santa Ana Branch Office.