A local lawyer talks about a tax evasion case and what the accused faces

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BAY CITY, Mich. (WNEM) – A Bay City restaurant owner is accused of underreporting his income and now faces a federal tax evasion charge.

Prosecutors said Jose Costilla, 45, knowingly submitted a falsified statement for the 2018 calendar year.

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

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

Prosecutors allege he knew he had a significantly higher total income.

“If we’re talking about a blatant situation, where someone is doing something very wrong with their taxes, that’s when things get thrown back to the prosecutor’s office. The IRS is not playing, but they will get their money if you short them, and if you cheat them they will use everything in their resources to get that money back,” Robinson said.

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

“It’s going to be hard to see how you can run the business from the potential inside 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.

“Ex-wives, ex-ex-girlfriends, ex-business associates where they pick up the phone and call, which is actually more common than an IRS agent coming across an anomaly in a tax return “Robinson said.


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