Auto Repair Owner Sentenced for Tax Theft

WA DOR News Releases

Filed March 18th, 2026

Detected March 20th, 2026

Summary

A Washington state auto repair business owner, Marlo Brown, has been sentenced to six months in jail for tax theft and filing a false tax return. She pleaded guilty to pocketing sales tax collected over four years and was ordered, along with her co-owner husband Phillip Brown, to pay back $36,875 to the state.

View original document View source feed page

What changed

The Washington State Department of Revenue, in conjunction with the Attorney General's Office, has concluded an enforcement action against Marlo Brown, co-owner of Brown's Garage. Marlo Brown was sentenced to six months in jail after pleading guilty to one count of filing a false tax return and first-degree theft for collecting and failing to remit sales tax between 2017 and March 2022. Her husband and co-owner, Phillip Brown, also pleaded guilty to filing a false tax return and received 30 days of home monitoring. The couple was ordered to pay $36,875 in restitution.

This case highlights the severe consequences of tax evasion, particularly the theft of collected sales tax, which is a significant source of state revenue. Businesses operating in Washington must ensure accurate reporting and timely remittance of all collected sales taxes. Failure to do so can result in criminal charges, jail time, and substantial financial penalties, including restitution to the state. The investigation found that the Browns employed tactics such as underreporting income and closing/opening business accounts to evade tax obligations, underscoring the importance of robust internal controls and compliance procedures.

What to do next

Review sales tax collection and remittance procedures.
Ensure accurate reporting of all business income.
Verify compliance with state tax laws regarding collected sales tax.

Penalties

Six months in jail for Marlo Brown; 30 days of home monitoring for Phillip Brown; combined restitution of $36,875.

Source document (simplified)

Home
About
News
News
Auto Repair Business Owner Sentenced For Tax Theft, Filing A False Tax

Auto repair business owner sentenced for tax theft, filing a false tax

OLYMPIA, Wash. March 18, 2026 –– A Shelton auto repair business owner was sentenced to six months in jail after pleading guilty to pocketing sales tax she collected over a four-year period.

Marlo Brown, co-owner of Brown’s Garage, pleaded guilty to one count of filing a false tax return and first-degree theft after being charged by the state Attorney General’s Office with underreporting the amount of sales tax collected and stealing sales tax.

Brown’s husband and co-owner of the business, Phillip Brown, pleaded guilty as a co-defendant in the case for filing a false or fraudulent tax return. He was sentenced Sept. 29, 2025 to 30 days of home monitoring. Marlo and Phillip Brown also were ordered to pay back a combined $36,875 to the state.

Marlo and Phillip Brown have owned an auto repair shop at several locations in Shelton since 2015. After failing to file tax returns and paying taxes owed, the Department of Revenue and the Attorney General’s Office launched an investigation into the Brown’s finances. The investigation found:

Marlo Brown had reported business income under “wholesaling” to avoid paying the sales tax they had been collecting.
The Browns had closed and opened multiple business accounts and continued to operate their business after the Department of Revenue filed tax warrants with the court and revoked their business licenses.
The business brought in much more than had been reported on tax filings and failed to remit thousands of dollars in sales tax between 2017 and March 2022. Collecting but not remitting sales tax is illegal under Washington state law. Businesses that sell retail goods and services in Washington are required to collect sales tax from customers and send it to the state.

Retail sales tax is the largest source of state revenue and funds vital services that benefit Washington’s residents and economy, including schools, health care, and more.

The Department of Revenue is Washington state’s primary tax agency, nationally recognized as a trusted leader in tax administration and customer service. Revenue administers nearly 60 categories of taxes that help fund vital public services. It also oversees programs that return money to the public, including the Working Families Tax Credit and Unclaimed Property.