Wilmington Restaurant Owner Pleads Guilty to Tax Evasion and Failure to Pay Employment Taxes on Behalf of Cash-paid Employees

Wilmington, Del. – Domenico Mazzella, the owner and operator of a Wilmington restaurant, Mazzella’s Italian Restaurant, pleaded guilty in federal court to a multi-year scheme to evade taxes, announced Julianne E. Murray, U.S. Attorney for the District of Delaware. Mazzella pleaded guilty to four counts of tax evasion and twelve counts of failure to collect, account for, and pay over trust fund taxes.

According to court documents and statements made in court, from at least 2017 through 2020, Mazzella defrauded the Internal Revenue Service (“IRS”). Mazzella failed to pay required employment taxes by paying a number of employees entirely in cash and concealing this cash payroll from his tax preparer. Mazzella also attempted to evade a substantial portion of his personal income tax by diverting over $600,000 from the business’s bank accounts to his personal account, falsely characterizing the payments as reimbursements for business expenses. Mazzella’s overstatement of expenses caused his tax preparer to underreport the restaurant’s income, which in turn caused Mazzella’s personal income to be substantially underreported on his tax returns.

Mazzella has agreed to pay restitution to the IRS in the amount of $549,370.39, consisting of evaded income taxes and employment taxes.  At sentencing, he faces a maximum of five years in prison for each of the 16 counts of conviction.  The Court will determine Mazzella’s sentence after taking into account the U.S. Sentencing Guidelines and other factors required by federal law.

“Domenico Mazzella’s actions were a deliberate attempt to cheat the American public and gain an unfair advantage over law-abiding businesses and citizens,” said U.S. Attorney Murray. “This plea demonstrates that our office, working with our law enforcement partners, will aggressively pursue those who willfully evade their tax obligations.”

“IRS-Criminal Investigation takes these violations of law very seriously,” said Yury Kruty, Special Agent in Charge of the Philadelphia Field Office. “This plea exhibits a positive message to honest taxpayers and further demonstrates that the IRS and U.S. Attorney’s Office are duty bound to protect the integrity of the U.S. tax administration system, and to make sure everyone complies with their tax obligations."   

The case was investigated by IRS-Criminal Investigation. Assistant U.S. Attorney Bryan C. Williamson is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information are located on the website of the District Court for the District of Delaware or on PACER by searching for Case No. 25-113-GBW.