Dr. John Compagno, Tax Evasion, California 2010

Bay Area Doctor Pleads Guilty To Tax Evasion

SAN FRANCISCO – Dr. John Compagno, a 70-year-old medical physician specializing in Pathology, pleaded guilty today to tax evasion in a California court. Compagno, a resident of Napa, Calif., is the owner and operator of three corporations located in Hercules, Calif.

According to the plea agreement, Compagno admitted to submitting both corporate and individual tax returns that understated his liability to the IRS. For the tax years 2005 through 2011, Compagno caused a corporate tax return preparer to overstate the amount of expenses on the corporate tax return by including non-deductible expenses.

Compagno approved and signed the corporate tax returns. The amounts of non-deductible expenses included during each year were as follows:

Non-Deductible Expenses:

2005: $407,714 – Additional Tax Due: $138,623
2006: $722,644 – Additional Tax Due: $248,814
2007: $1,712,621 – Additional Tax Due: $601,235
2008: $2,511,211 – Additional Tax Due: $737,848
2009: $2,640,726 – Additional Tax Due: $916,547
2010: $1,090,799 – Additional Tax Due: $646,063
2011: $1,593,365 – Additional Tax Due: $569,930

The total non-deductible expenses included were $10,679,080, resulting in a total additional tax due of $3,859,060. In addition, Compagno omitted constructive dividends from his 2006 through 2011 individual income tax returns, resulting in an additional tax due of $1,567,179.

Compagno acknowledged in his plea agreement that he owes over $5.4 million in unpaid taxes. He was charged by Information filed November 16, 2016, with one count of tax evasion, in violation of 26 U.S.C. § 7201. In today’s plea agreement, he pleaded guilty to knowingly and willfully filing with the IRS a false 2010 corporate tax return.

Compagno is scheduled to be sentenced on March 28, 2017, at 2:00 p.m., before the Honorable William Alsup, U.S. District Judge. The maximum sentence for tax evasion, in violation of 26 U.S.C. § 7201, is five years in prison and a fine of $250,000.

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