Consider the case of tax preparer Robert Coates of Ohio. Unfortunately, some tax preparers will choose to engage in tax fraud to attract and keep clients. When financial circumstances are unfavorable, tax preparers who guarantee a return of a certain amount may be forced to choose between disappointing the client and having them take their business elsewhere and engaging in tax fraud. While everyone wants to receive a refund on Tax Day, the simple fact of the matter is no tax professional can reasonably render an opinion or tax position without first assessing the financial standing and circumstances faced by the client. While the previous scheme was likely difficult for a taxpayer to detect, any tax preparer who immediately guarantees a minimum tax refund amount, that you will receive a refund, or the largest tax refund in town should instantly trigger concerns in the mind of the taxpayer. Preparers Who Guarantee a Large Return without Assessing Your Taxes Should Raise Red Flags Prosecutors believe that Jones fraudulently obtained at least $300,000 in overstated tax refunds. For tax evasion and computer fraud convictions, Jones was sentenced to 20 years in jail. Likely in recognition of how her sole argument was utterly unconvincing, Jones pleaded guilty to the charges against her. She did, however, offer a partial explanation for her acts: the computer malfunctioned and may have entered erroneous data on a tax return. When questioned about the discrepancies, Jones was unable to fully explain the conduct or the filings. Jones would then direct officials to deposit the additional monies to her business accounts. After the taxpayer examined and signed the correct return, Jones would then e-file a bogus electronic return with the IRS and state of Mississippi that overstated expenses, understated income, or otherwise improperly increased the tax refund. Jones and Mobile Express Tax and Accounting Services apparently engaged in fraud by first presenting taxpayers with an accurate written copy of their tax return. In one recently reported tax preparer fraud case in Mississippi, Preparer Kushauntia Jones, owner of Mobile Express Tax and Accounting Service came under investigation after submitting multiple client tax returns with significant irregularities. ![]() Courts Are Reluctant to Believe Tax Preparers Who Submit False Tax Returns While Blaming the Computer The preparer him- or herself is likely to face criminal tax charges that may include a lengthy federal prison sentence. Clients affected by a dishonest preparer are likely to be audited and on the hook for unpaid tax liabilities plus interest and penalties. ![]() Unfortunately, tax preparers who take such action open the door to a word of trouble for their clients and themselves. These tax preparers may make misstatements of fact such as inflating expenses or concealing income to minimize tax due and trigger a large, unjustified tax return. However, the nature of competition can motivate some preparers to abuse the trust their position provides. When tax preparers act as they should and only recommend taxpayers to take well-supported tax positions, all parties benefit and prosper. Taxpayers rely on and trust in these individuals to provide accurate, timely advice regarding an array of tax obligations. Throughout cities and communities in the United States, tax preparers, and other professionals occupy a position of public trust. What to do when you Forget to File Taxes.How to Survive a High Stakes Tax Audit: A Comprehensive Guide.California and Federal Employment Tax Audits.IRS Tax Audit Guides for the Self-Employed.IRS Tax Audit Guides for Business Owners.Offshore Voluntary Disclosure Program (OVDP).Offshore Voluntary Disclosure Initiative (OVDI).International Tax Law – California Attorney for IRS International Tax Voluntary Disclosure Practice.International Tax and Transfer Pricing Dual Licensed Tax Attorneys & CPAs.The Ultimate COVID-19 Resource Compilation.California Voluntary Disclosure Program. ![]() California Cryptocurrency Tax Attorney and CPA. ![]()
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