Call Now (800) 681-1295

Utah Tax Preparer Sentenced to Prison for Tax Scheme and Obstructing IRS

Table of Contents

    Filing your tax returns can be complicated. Honest mistakes will not be held against you for criminal penalties. However, those who deliberately mislead the Internal Revenue Service (IRS) can be charged with tax crimes and may face serious penalties.

    For instance, on January 10, 2023, a professional tax preparer in Utah was ordered to serve 37 months in prison and must pay $1,104,737 in restitution to the U.S. government. The perpetrator attempted to defraud the IRS by concealing his income and assets. Furthermore, after being audited, he attempted to obstruct the government’s investigation by renaming his business and placing it in his family members’ names.

    If you are at risk of being charged with a tax crime, you can contact the Tax Law Offices of David W. Klasing for options. Our experienced Dual Licensed Tax Attorneys and CPAs can help assess your case and determine how to proceed. Our phone number is (800) 681-1295.

    If you have failed to file a tax return for one or more years or have taken a position on a tax return that could not be supported upon an IRS or state tax authority audit, eggshell audit, reverse eggshell audit, or criminal tax investigation, it is in your best interest to contact an experienced tax defense attorney to determine your best route back into federal or state tax compliance without facing criminal prosecution.


      As long as a taxpayer that has willfully committed tax crimes (potentially including non-filed foreign information returns coupled with affirmative evasion of U.S. income tax on offshore income) self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosure before the IRS has started an audit or criminal tax investigation / prosecution, the taxpayer can ordinarily be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously often receive a break on the civil penalties that would otherwise apply.
      Moreover, only an Attorney can enter you into a voluntary disclosure without engaging in the unauthorized practice of law (a crime in itself). Only an Attorney trained in Criminal Tax Defense fully understands the risks and rewards involved in voluntary disclosures and how to protect you if you do not qualify for a voluntary disclosure.

    Professional Tax Preparer Convicted of Tax Crimes in Utah

    Sergio Sosa of Orem, Utah owned and operated a tax preparation business called Sergio Central Latino. From 2004 through 2020, he attempted to defraud the Internal Revenue Service (IRS) by failing to report his income and assets on his tax returns properly. Specifically, from 2003 through 2017, Sosa had failed to file his returns on time or pay the full amount of taxes he owed. Furthermore, after being audited, he obstructed the government’s investigatory efforts by renaming his business and placing it in his kids’ names, using nominees to open business bank accounts, and making false declarations to the IRS.

    Accordingly, Sosa is now facing criminal tax penalties, including severe fines and jail time. The tax evader has been sentenced to 37 months of jail time and has to pay $1,104,737 to the federal government.

    It is best for taxpayers to report their earnings truthfully to avoid facing the same fate as Mr. Sosa. However, committing an error when filing your tax returns is easy. In some instances, people who make honest mistakes can be wrongfully accused of evading their tax obligations. If you fear being accused of tax fraud, you can seek aid from our Dual Licensed Tax Attorneys and CPAs. Our team is ready to assist with your case.

    How Does the IRS Catch Tax Fraud?

    There are several different forms of tax fraud. For instance, taxpayers can commit fraud by deliberately failing to report income or intentionally overstating write-offs that they are not entitled to or claiming credits they are not entitled too. The Internal Revenue Service (IRS) can uncover instances of tax fraud in various ways. For instance, the following are common examples of ways the IRS can catch individuals committing these crimes:

    Analyzing Computer Data

    The IRS utilizes an Information Returns Processing (IRP) system to try and match information sent by employers and other third parties to the IRS with the information reported by individuals on their tax forms. Typically, the matching is based on information submitted through W-2s (reporting earnings), 1099s (reporting securities transactions, dividends, interest, and non-employee wages), and Schedule K-1s (reporting expenses and income from trusts, estates, partnerships, and S corporations). IRS computers exam the returns of the taxpayers that received this reported information to make sure it has been properly reported on their tax returns.

    The IRS computers have become more sophisticated over time. Rather than simply matching and filtering taxpayers’ information, it is suspected that the IRS can now track information like medical records and credit card transactions. If you have encountered a tax issue raised by the IRP system, then you should get in touch with our law firm as soon as you can. Our Dual Licensed Tax Attorneys and CPAs can help protect your interests.

    Whistle Blowers

    The IRS also regularly catches tax fraud with the assistance of whistle blowers. A whistle blower informs on an individual taxpayer or organization in hopes of receiving a reward or often simply for revenge. For example, an aggravated employee or upset spouse may inform the IRS about unreported income or other illegal actions committed by taxpayers.

    There are many reasons a whistleblower may decide to report improper activity. For example, they may do so out of a desire for revenge or a desire to do the right thing. Furthermore, some whistleblowers report illegal activity to the IRS for cash rewards. The IRS may pay a whistleblower a reward of up to 30% of the tax loss that was recovered as a result of the reported information.

    Social Media Footprints

    Lastly, the IRS can also catch tax fraud through peoples’ social media footprints. IRS agents regularly use social media to locate tax cheats. For instance, posting on social media accounts may reveal that people are living lifestyles that do not coincide with the amount of income reported on their tax returns. However, it is not known whether the IRS is looking into nonpublic social media postings or private communications like emails.

    How Long Will You Go to Prison for Tax Evasion?

    Those who intentionally evade their tax obligations may serve time in prison. The main consideration in determining how much time will be served is the value of the tax loss the government incurred. Generally, those that create greater tax losses will have to serve more time in jail.

    However, other factors may play a role in determining sentencing for tax crimes. For example, a defendant’s criminal history may be analyzed when determining how much time they should serve. If you fear facing prison time for tax evasion, our Dual Licensed Tax Attorneys and CPAs can help mount your defense.

    If are Under IRS Criminal Tax Investigation, Under Audit, Facing an Eggshell or Reverse Eggshell Audit, our Lawyers are Here to Help!

    If you fear you may be charged with a tax crime, get help from our experienced Dual Licensed Tax Attorneys and CPAs by calling Tax Law Offices of David W. Klasing at (800) 681-1295 or scheduling online HERE.

    More Commonly Asked Tax Audit Questions

    Questions and Answers for Criminal Tax Representation

  • When tax defense counsel parallels tax crime investigation
  • Guilty of tax obstruction by backdating documents?
  • To be found guilty of tax obstruction must a person actually be successful in impeding the IRS’s functions?
  • Help! The Document I Gave the IRS Had False Information
  • What is the crime known as tax obstruction § 7212?
  • What is the difference between tax perjury and tax evasion?
  • What is the tax crime commonly known as tax perjury?
  • What is a Klein Conspiracy?
  • Increased possibility of civil action in IRS investigation
  • Am I Guilty of Tax Evasion if the Law is Vague?
  • What happens if the IRS thinks I committed tax crimes?
  • What are ways to defend against a tax evasion charge?
  • Difference between criminal tax evasion and civil tax fraud
  • What accounting method does the IRS use for tax fraud
  • Can I Change Accounting Method to the Accrual Method
  • What is the willfulness requirement for tax evasion?
  • I didn’t know I committed tax fraud. Can I get off?
  • Concealed assets from IRS. Can I avoid tax evasion charges
  • How government proves I willfully engaged in tax evasion
  • What is the venue or court where a tax crime case is heard?
  • Must the IRS prove tax crimes beyond a reasonable doubt?
  • Is it a crime to make false statements to the IRS?
  • Will the IRS overlook my tax evasion if it’s minor?
  • Failed to tell IRS about my nominee account
  • Audit risk with cash based business transactions
  • How to defend a client charged with tax evasion
  • Is it tax evasion if I didn’t file income tax return?
  • Government says I attempted to evade my taxes. Now what?
  • I forgot to pay my taxes or estimated tax. Is this a crime?
  • Government proof I “willfully” failed to pay taxes
  • 5 Ways to Respond to Tax Evasion Charges
  • Being audited after using a tax professional
  • Rules for what an IRS agent can do while investigating me
  • How tax preparers, attorneys and accountants are punished
  • How the IRS selects tax crime lead for investigation
  • How does the IRS prosecute suspected tax crimes?
  • Does IRS reward informant leads for suspected tax crimes?
  • How the government proves deficiency in a tax evasion case
  • Do prior tax crimes factor into new IRS tax convictions?
  • Requesting conference before investigative report is done
  • Requesting conference after IRS Special Agent Report
  • What are my rights during an IRS criminal investigation?
  • Avoid prosecution for tax crime with voluntary disclosure?
  • Defense tactics that make it hard for to prove willfulness
  • How a tax attorney can stop your criminal tax case?
  • What can you generally tell me about tax crimes?
  • Continuing filing requirement with investigation pending
  • Federal criminal code crimes that apply to tax issues
  • Penalty for making, subscribing, and filing a false return
  • CID special agent’s report for criminal prosecution
  • What is the discovery process in a criminal tax case?
  • What the IRS includes in indictment for tax case
  • What is the hardest element of a tax crime to prove?
  • IRS methods of gathering evidence to prove tax crime
  • What does a grand jury do in IRS tax crime prosecution?
  • Failure to keep records or supply information
  • Failure to make a return, supply information, or pay tax
  • What is attempting to evade payment of taxes?
  • What is income tax evasion and how is it punished?
  • What is attempted income tax evasion?
  • What is the crime of failure to pay tax? What is punishment
  • Crime of making or subscribing false return or document
  • Criminal Investigation Division investigation tactics
  • Tax crimes related to employment tax forms and trust funds
  • Tactics to defend or mitigate IRS criminal tax charges
  • How the IRS generates leads about suspected tax crimes
  • What is the crime ”evasion of assessment” of tax?
  • Specific examples of “attempting” to evade tax assessment
  • What is the so-called Spies evasion doctrine?
  • Does overstating deductions constitute tax evasion?
  • Is it tax evasion if my W-4 contains false statements?
  • What are the penalties for Spies tax evasion?
  • How government proves a taxpayer attempted tax fraud
  • What is a tax that was “due and owing.”
  • What is evasion of assessment for tax liability?
  • Is evasion of assessment different from evasion of payment
  • Does the IRS have a dollar threshold for tax fraud?
  • What is the IRS burden of proof for tax fraud convictions?
  • Are Tax Laws Constitutional?
  • What is the source of law that defines tax evasion?
  • Does section 7201 create two distinct criminal offenses?
  • Does tax evasion definition include partnership LLC
  • What if I helped someone else evade taxes?
  • Is it illegal to overstate deductions on my tax return?
  • Is it illegal to conceal bank accounts from the IRS?
  • Do later losses justify prior deductions?
  • Common reasons the IRS and DOJ start investigations
  • What is the Mens Rea component of tax crimes?
  • What is a proffer agreement and what are the risks?
  • Why to have an attorney to review a proffer agreement
  • Why enter into a proffer agreement?
  • Limited use immunity from proffer agreements
  • Difference between civil and criminal fraud allegation
  • Tax Help Videos

    Representing Clients from U.S. and International Locations Regarding Federal and California Tax Issues

    Main Office

    Orange County
    2601 Main St. Penthouse Suite
    Irvine, CA 92614
    (949) 681-3502

    Our headquarters is located in Irvine, CA. Our beautiful 19,700 office space is staffed full-time and always available for our clients to meet with our highly qualified and experienced staff of Attorneys, Certified Public Accountants and Enrolled Agents. We also offer virtual consultations and can travel to meet with clients in one of our satellite offices.

    Outside of our 4 hour initial consultation option, we do not charge travel time or travel expenses when traveling to one of our Satellite offices, or surrounding business districts, where it is necessary to meet personally with taxing authority personnel, make court appearances, or any in person meeting deemed necessary for the effective representation of a client. To make this as flexible, efficient, and convenient as possible, David W. Klasing is an Instrument Rated Private Pilot and Utilizes the Firms Cirrus SR22 to service client’s in California and in the Southwest by air. Offices outside these areas are serviced via commercial jet airlines. None of these costs are charged to our clients.

    Satellite Offices

    (310) 492-5583
    (760) 338-7035
    (916) 290-6625
    (415) 287-6568
    (909) 991-7557
    (619) 780-2538
    (661) 432-1480
    (818) 935-6098
    (805) 200-4053
    (510) 764-1020
    (408) 643-0573
    (760) 338-7035
    (602) 975-0296
    New Mexico
    (505) 206-5308
    New York
    (332) 224-8515
    (512) 828-6646
    Washington, DC
    (202) 918-9329
    (702) 997-6465
    (786) 999-8406
    (385) 501-5934