Verona drywall business owner faces 18 months in federal prison for over $550K tax evasion
Gustavo Reyes, 52, a Verona man who owned a drywall business, was sentenced on Thursday to 18 months in federal prison for tax evasion totaling $557,907.19, according to the Wisconsin State Journal. Reyes was sentenced by Judge William Conley after pleading guilty to the tax evasion charge on May 24.
Reyes owned and operated the business between 2013 and 2020; a 2015 IRS audit of his income tax returns for 2013–14 determined significant underreporting for those years. The IRS sent multiple notices from 2015–2019 to Reyes regarding tax deficiency assessments and did not receive a response. The IRS also filed tax liens, attempting to collect the taxes Reyes owed, and filed levies against several of his business bank accounts, but Reyes failed to pay any of the tax debt.
From tax year 2018–2020, Reyes operated his drywall business through five nominee entities in Dane County — including Royal LLC, American Drywall, and Morales Construction — in an attempt to defeat IRS collection efforts. He also avoided IRS liens and levies by operating using large cash amounts from cashing checks at establishments throughout the Madison area.