Tax Preparer’s 6,000 False Returns Go Up in Smoke!

In order to hide evidence from the IRS two fires were intentionally set at Rush Tax Service locations, one in 2017 and one in 2019. The fires destroyed client files, financial records, and computer hardware.

Between 2013 and 2017, the owner of Rush Tax Service, Andrivia Wells, prepared more than 6,000 tax returns that falsely claimed more than $3 million in refunds. During this time Rush Tax Service received over 1.2 million dollars in fees from clients. The fees were taken directly from the clients’ tax refunds and in most cases the clients were unaware of how much they were being charged.

Wells prepared income tax returns for clients that claimed false filing statuses, false American Opportunity and education credits, and false fuel tax credits, among others, in order to inflate refunds. Wells also falsified her own income tax returns by underreporting the fees she earned from the business for tax years 2014, 2015, 2016, and 2017. In 2018 she failed to file a tax return with the IRS.

Wells pleaded guilty to aiding and assisting in the filing of false tax returns and filing a false tax return She was sentenced to 70 months in prison and ordered to pay $3,373,595 in restitution.

Nonprofit Founder Hoping 4 Change in Legal Troubles

Barry Isaacs founded the Cincinnati nonprofit Hope 4 Change when he was 24. Eleven years later he has been sentenced to four years in prison for failing to pay payroll taxes and embezzlement.

Hope 4 Change provides housing and care for adults with developmental disabilities, and at one time had over 180 employees. Between 2013 and 2014 Isaacs failed to pay $360,000 in payroll taxes that he withheld from employees. He wrote checks to himself and family members and spent the money on personal expenses including massages, clothes, cars, rent, air travel and hotels.

Isaacs was ordered to pay the $360,000 to the IRS as well as $216,000 to OTR Capital, LLC. The restitution to OTR Capital is connected to a separate fraud case prosecutors say was instigated by Isaacs’ ex-wife, Teela Gilbert. Isaacs pleaded guilty in that case to wire fraud and identity theft.

Isaacs was indicted in 2019 but fled the state. The US Marshalls fugitive task force found him living in a hotel in Houston under a false name.

Your IRS Questions Answered Here…

Question: I owe 78,000 to the IRS for back taxes. I’m constantly getting threatening letters from them. This has become a big problem in my life that I have no idea how to solve.  Can you help me?

Answer:  For what it’s worth, take some comfort in knowing that you are not alone. There are tens of millions of Americans in similar situations, dealing with IRS debt hanging over their heads and concerned about how it will affect their future.

The good news: You have options. Once you and your tax resolution specialist has analyzed your current financial situation, the next step is to negotiate a resolution with the IRS.  You will most likely be looking at one of two options – the Offer in Compromise or the Installment Agreement.

The Offer in Compromise (OIC) was created for people who owe a substantial amount to the IRS but who, for whatever reason, are unable to pay their tax debt off, even over time. The Offer in Compromise allows taxpayers to negotiate a settlement amount that will take care of the entire tax debt once and for all. This settlement agreement can lower the tax debt by a significant amount, however there are strict eligibility requirements.

If you do not qualify for the OIC then you may consider the Installment Agreement, which allows you to pay off your debt over time by making manageable monthly payments, much like a commercial installment loan.

Investors Duped in Hotel Scam

Christopher Ciccone, a New Jersey businessman who was previously convicted of wire fraud and filing a false tax return, was arrested for defrauding investors of more than one million dollars.

 

Ciccone lured prospective investors with the notion that his company was reserving blocks of rooms at luxury hotels, which would later be resold at a profit.

 

He promised investors returns between 15 and 50 percent within one to six months. His scheme generated 1.5 million dollars from 22 investors.

 

In reality, Ciccone never booked any hotel rooms. He used $120,000 of the investors’ money to pay early investors and to fund a lavish lifestyle. He spent $54,000 on a BMW, $235,000 on clothes, wine and other personal items and made more than $216,000 in cash withdrawals.

 

Ciccone failed to include this money on his tax returns, and faces up to 20 years in prison and a 5 million dollar fine.

This Couple’s Tax Fraud and Money Laundering Scheme Was Very Dirty

A couple from Maryland, James and Maureen Wilson, was indicted for conspiracy, mail fraud, wire fraud, money laundering, identity theft and filing a false tax return in connection with a life insurance scheme.

 

Starting in 1996 the Wilsons sought to obtain more than 30 life insurance policies worth more than 20 million dollars on behalf of applicants. The policies were obtained using false information, including the amount of the applicant’s existing life insurance coverage, the applicant’s health and the applicant’s income.

 

The Wilsons later forged the signatures of the life insurance applicants and made themselves the beneficiaries of the policies. As a result, they received more than 8 million dollars in life insurance proceeds.

 

In order to launder and conceal these funds, the Wilsons controlled multiple bank accounts, some in their names and several with nominee owners.

 

In 2018 and 2019 they filed false tax returns and failed to report millions of dollars of illegally obtained life insurance proceeds.

Tax Preparer Sentenced to Multiple Years In Prison for Filing Multiple False Tax Returns

Damian Barrett, a Florida tax preparer, was convicted of filing 745 false tax returns in 19 states.

 

Barrett owned two tax preparation companies. He used one to file legitimate returns and the other to file false returns.

 

From 2015 to 2018 Barrett filed 348 false returns in the state of Oregon alone, requesting more than $322,000 in fraudulent refunds. The state paid out more than $130,000 in refunds as a result of these claims.

 

Barrett used names and social security numbers of various individuals, some of whom were his legitimate clients, to submit the false returns. He also set up bank accounts in the names of some of his victims in order to receive the refunds.

 

In total he sought almost $900,000 in refunds and received over $234,000 in fraudulent refunds.

 

Barrett was sentenced to 54 months in federal prison and to pay more than $234,000 in restitution to 11 state departments of revenue, and more than $74,000 to the IRS.

 

Money Grows on Trees for Nursery Bookkeeper

The bookkeeper for a family owned tree nursery in North Carolina pleaded guilty to embezzling more than one million dollars over a six year period.

 

Richard Clark began working for the nursery in 2003, and in 2013 started writing checks to himself from the company. He covered his tracks by altering the check descriptions in Quickbooks. In 2016 Clark’s employer changed addresses and asked Clark to close one of the company’s bank accounts. Clark kept the account open and maintained the old address, which he gave to customers who were mailing checks to the company, and to receive bank correspondence. Clark then wrote himself checks from this account without his employer’s knowledge.

 

Clark used $50,000 of the stolen funds for a home theatre, $80,000 for his mortgage and $20,000 for a Ford F-250. In 2016 he excluded more than $21,000 from his personal income tax return and in 2017 did not file a return, creating a tax loss of $68,918.

 

Clark was sentenced to four years in prison and ordered to pay $194,750 to the IRS, and $980,000 in restitution to his former employer.

Instructor Fails to Learn the Language of the IRS

Daniel Berglund, a self-employed computer language instructor, was convicted of four counts of tax evasion for failing to file taxes from 1987 to 2017. Berglund took many steps to hide his income from the IRS – including giving his clients a made up tax identification number to prevent payments to him from being reported to the IRS, depositing payments into accounts not in his name, and converting cash payments into silver, that he hid throughout his home.

 

Berglund’s tax evasion resulted in a tax debt of $146,806. He faces a maximum prison sentence of five years and up to $250,000 for each count of tax evasion.

Cryptocurrency Company Owners Face 5 Years in Prison!

The founders of a cryptocurrency company, Bruce Bise and Samuel Mendez, pleaded guilty to tax evasion for a scheme that defrauded more than 13,000 investors of approximately 24 million dollars.

 

Bise and Mendez marketed their company, Bitqyck, and the company’s currency, Bitqy, as a way for “those individuals who missed out on Bitcoin” to get rich. Except they were the only ones who got rich.

 

The two men promised investors shares in a currency that never existed, and profited by diverting money from the company for their personal use. From 2016 to 2018 they used almost nine million dollars of investor money for personal expenses. This included multiple casino trips, cars, luxury home furnishings, art and rent.

 

In 2016 and 2017 Bise underreported his income to the IRS, resulting in a tax loss of $371,278. During the same period Mendez also underreported his income, resulting in a tax loss of $311,155. In 2018 the company failed to file a corporate tax return despite netting more than 3.5 million dollars from investors.

 

Both men face up to five years in prison.

Your IRS Questions Answered Here…

Question: The IRS is hounding me and won’t leave me alone, so I’ve finally decided to seek help from a Tax Professional who specializes in IRS problems.  I want to start getting my paperwork together for the appointment; what will I need to bring with me?

 

Answer:  It’s very important to have certain documentation with you for the initial interview.  Your tax resolution specialist will need this info to protect your income and assets and to determine the best way to move forward to resolve your tax issues.  The items to bring include:

 

Ø  The most recent IRS/State tax notices and collection letters;

Ø  The latest filed income (1040) tax return

Ø  A monthly household cash flow budget by expense category (list all outflows and inflows of money)

Ø  Your most recent paystubs with YTD info verifying income from all sources and all withholdings and payroll deductions;

Ø  If you are self-employed, an independent contractor, or small business owner, prepare a “rough draft” current profit and loss statement. If this is not possible, just bring your Schedule C from your most recently filed 1040;

Ø  A list of any quarterly estimated tax payments made, if any, for the current year

 

The information above will determine which IRS debt settlement program is best suited for you, including settling with the IRS for a fraction of what you owe, if you qualify.