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Tax preparers can be prosecuted for filing false returns

Many American rely on their tax preparers in order to file taxes in a timely and accurate way. That makes sense, given how complicated tax forms, and the tax laws themselves, can be.

Most of these preparers are hardworking, knowledgeable and dedicated. As with any field of human activity, however, there are sometimes bad apples who engage in wrongdoing.

In a recent case in Dallas - Fort Worth, a tax preparer who filed scores of false returns has been sentenced to a federal prison term. The preparer received a sentence of more than three years in prison after pleading guilty to filing hundreds of false returns.

The returns were false because they claimed a first-time homebuyer tax credit that the tax preparer's clients were not entitled to. According to the charges, the clients either were not eligible for the credit or did not provide the necessary records to establish eligibility.

Federal agents arrested the preparer in August of last year. She pleaded guilty in November and was sentenced earlier this month. In addition to the prison sentence, the woman has been ordered to pay restitution to the government. The amount of the ordered restitution is $1.7 million dollars.

It is in part to help prevent incidents like this that the IRS has been trying to increase its regulation of professional tax preparers. As we discussed in our February 1 post, those efforts are now in a rather uncertain state. The IRS is appealing a federal judge's recent ruling that the agency overstepped its statutory authority in issuing those regulations.

Source: "Texas Preparer Sentencing For Filing False Tax Claims," KWTX, 3-5-13

To learn more about our practice, please visit our page on criminal tax.

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