Restitution, jail ordered in tax case
MILWAUKEE — A Williams Bay man who emigrated from Mexico and started several enterprises but reported too little of his taxable income was sentenced Friday in federal court to 10 months in jail and ordered to pay $137,416 restitution.
Angel Miguel Carbajal, who also is known as Angel Carbajal Ortiz, did the bookkeeping for his company ANC Concrete and prepared tax returns and immigration documents from his Williams Bay and Milwaukee offices under the business name Centro San Miguel.
A 2008 tax audit revealed Carbajal reported $450,000 in gross receipts for ANC in 2006 and 2007, but ANC's bank deposits were about $800,000, according to the plea agreement.
While Carbajal initially said ANC didn't earn a profit after expenses, he acknowledged having two Social Security numbers and that he and his girlfriend both claimed head of household status for the same address on separate tax returns, according to court documents.
The IRS also learned that Carbajal reported part of his income from CSM on his brother's return. Carbajal's brother was a full-time student in Illinois and said he wasn't aware what Carbajal had done.
In court Friday, defense attorney Peter Wilson recommended probation only for his client, who he said was remorseful for his actions.
Carbajal took out a second mortgage on his house to pay the restitution ordered for back taxes, penalties and interest, said Wilson.
According to court documents:
Carbajal was 18 and had a sixth grade education when he emigrated from Mexico in 1990. He went to work in factories near Woodstock, Ill., beginning at $4 an hour. After several years, Carbajal befriend Chicago attorney Michael Crane, who hired Carbajal to help the caretaker for Crane's property in Walworth County.
Carbajal worked for Crane until 2010 and meanwhile bought and rehabilitated homes in Williams Bay and on Delevan Lake, renting one along with two boats during summer months. He also owns a bed and breakfast in Mexico.
In 2004, Carbajal began preparing the first of what would be thousands of tax returns and immigration documents for other immigrants.
Assistant U.S. Attorney Matthew Jacobs called the tax documents Carbajal prepared for others "an aggravating factor" in the tax fraud case, Wilson said.
District Judge Rudolph Randa imposed a sentence from the low end of the 10- to 16-month advisory guideline range and ordered Carbajal to report to jail Jan. 21.
