The United States filed a complaint seeking to permanently bar a Durant, Mississippi, woman and the tax preparation business she operates from preparing federal tax returns for others, the Justice Department announced today.
The civil complaint against Teresa Chism and her business, Lady T. Taxes, was filed in the U.S. District Court for the Southern District of Mississippi. The complaint alleges that Chism prepares income tax returns for customers that fraudulently overstate the refunds due by falsely claiming refundable credits, including the Earned Income Tax Credit (EITC) and credits for education expenses. The complaint further alleges that Chism frequently prepares a fabricated Internal Revenue Service (IRS) Form W-2, Wage and Tax Statement, to submit with a tax return in order to maximize the amount of EITC a customer claims.
According to the complaint, since 2010, Chism has prepared more than 2,845 tax returns, and audits of 220 returns uncovered a total of more than $1 million in tax credits that Chism’s customers were not entitled to claim.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams for 2015. The IRS has some tips on its website for choosing a tax return preparer, and has launched a free directory of federal tax return preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers and tax scheme promoters. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Source: US Department of Justice
