New Tax Preparer Fraud Cases Pop Up All Over the United States
Tax fraud is an ongoing issue, and it can have dire consequences.
While you may not be surprised to hear about individuals fudging numbers on their taxes, there are many professional tax preparers who have been found guilty of this crime and have had their businesses shut down and their licenses taken away as a result Many face prison sentences and considerable fines as well.
Here are a few recent incidents that you may find shocking.
Fort Lauderdale, FL
Unity Tax & Financial Services owner Nikency Alexis ran his business for several years until fraud allegations brought it all crashing down. Alexis and one of his return preparers, Thony Guillaume, are being charged with conspiring to defraud the United States by preparing false returns that increased their clients’ refunds. Allegations are being made that the two claimed business and education expenses their clients did not incur. Alexis is also being charged with making false statements on his personal taxes.
If Alexis and Guillaume are convicted, they will face a maximum five year sentence on conspiracy charges and three years in prison for each time they prepared a false return. Alexis is also facing a three year maximum sentence for the false claims he made on his personal taxes. They will also face supervised release after sentences are completed as well as monetary penalties.
It’s not all bright and sunny in California, especially if you’re Esther Oregon.
Oregon was once the proud owner of Mex Tax services. Now the state is seeking to bar her from owning and operating a tax return preparation business due to her underreporting her clients’ federal tax liabilities. She is being charged with making inflated or false claims for tax credits, itemized deductions and income and business expense deductions.
After some investigation, it was found that Oregon underreported approximately $4120 per return in 2017 and $2714 per return in 2018 causing the IRS to lose an amount in excess of $6.9 million dollars.
Rock Springs, WY
Moving over to the Midwest, we find another tax prep expert in hot water. CPA Paul Edman of Rock Springs, WY pled guilty to a charge of aiding or assisting in the preparation of a false document filed with the IRS. According to allegations, he knowingly counseled clients to falsify their 1040 Forms.
Edman is looking at a possible three year prison sentence with one year of supervised release. He will also be forced to pay a fine that may be as high as $100,000.
Detroit area’s The Tax Experts have been running quite a racket.
Owner Jeanisia Allen is alleged owner and operator of The Tax Experts, a business run through co-defendants First Choice Tax Solutions, LLC, The Tax Experts Inc., The Tax Experts LLC and Top Notch Taxes Inc. Charges claim that Jennifer Sherman, Erica McGowan, Annetta Powell and Jasmin Powell entered into agreements with Allen and her entity The Tax Experts, LLC to use the name “The Tax Experts”.
Allen and her cohorts are currently facing charges of falsely filing tax returns, fabricating businesses, business income and expenses and claiming false education credits and improper filing statuses. In doing so, they have harmed clients that may end up owing penalties and interest. Allen also failed to properly train, oversee and control businesses operating under the Tax Experts name.
The Tax Experts were said to have operated 32 stores, primarily located in metro Detroit although they ran other locations in Chicago and Los Angeles. In their three years in business, they prepared over 17,000 tax returns and claimed over $82 million in tax refunds. In doing so, it is estimated that they shorted the IRS $3,552,114, an average or $5349.57 per completed return.
Tax fraud also reared its head in Mississippi as a civil complaint was filed against Terance Price and his business Superior Taxes. Price is charged with preparing taxes that led to understatements of what the taxpayers owed and overstatements of refunds they were entitled to. The state alleges that he made false claims concerning energy and fuel credits as well as unreimbursed employee business expenses.
Price has been operating his business since 2015 and has filed hundreds of returns. Potential tax losses for the years 2017 and 2018 alone could exceed $1 million. His conduct has also harmed his customers who will be responsible for paying interest and penalties.
We are unclear on what caused these professionals to commit fraud, but what we do know is that the right educational tools could have kept them from incurring considerable fines and getting their businesses shut down. They may have realized the errors they were making and been more aware of the consequences.
At Latino Tax Pro, we offer all the resources you need to keep your business above board. We provide bookkeeping courses, continuing education courses, tax law courses and tax update courses that will help you provide the best services to your clients, without having to break the law. Contact us to find out how you can take your tax skills to the next level or click here to join us at Latino Tax Fest to learn the latest updates.