IRS takes small business owner to court, claims tax fraud

The government recently accused a small business owner of various tax crimes. The woman owned a tax preparation business. The Internal Revenue Service (IRS) claimed she prepared false and fraudulent income tax returns. More specifically, the agency claimed the following violations:

 

  • Making up and inflating deductions. The IRS claimed the woman made up vehicle expenses, meal expenses and entertainment costs to help better ensure the client would receive a tax refund.
  • Failed to provide evidence to support the claims. The agency also stated the woman failed to provide paperwork to support the deductions. They stated this further supported the allegation the deductions were fabricated.
  • Falsely claimed credits. The IRS also stated the woman would claim tax credits for clients.

According to court documents, the agency stated the tax crimes occurred over a span of four years, from 2014 through 2017 and resulted in over $200,000 in fraudulent refunds. When faced with the evidence, the accused chose to accept a plea deal. She pled guilty to criminal charges for aiding and assisting in the preparation of false income tax returns. The court has scheduled the small business owner for sentencing in September 2020.

A conviction for tax return preparer fraud can come with serious criminal penalties. Depending on the details of the allegations these penalties can include hefty financial penalties as well as potential imprisonment. It is also likely the accused would no longer be able to practice in their chosen profession. As a result, it is wise to take the allegations seriously and act to protect your interests

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