Middleton Nail Salon Owner Pleads Guilty to Tax Evasion

MADISON, WIS. – Chadwick M. Elgersma, Acting United States Attorney for the Western District of Wisconsin, announced that Tam Phan, 40, Middleton, Wisconsin, pleaded guilty yesterday to tax evasion in connection to her nail salon business, Happy Nails & Spa, in Middleton.

Phan has been the operator and sole proprietor of Happy Nails & Spa since 2010.   The government’s investigation revealed that a large percentage of Happy Nails customers paid for their services with cash between 2021 and 2023. However, Phan’s tax returns for that time period only reported the credit card sales. During the plea hearing, Phan admitted that she intentionally failed to report the cash sales from Happy Nails & Spa on her 2022 federal tax return.

U.S. District Judge William M. Conley scheduled Phan’s sentencing for October 28, 2025. Phan faces a maximum penalty of 5 years in prison.

The charge against Phan was the result of an investigation by IRS Criminal Investigations. Assistant U.S. Attorney Aaron Wegner is handling the prosecution.