WASHINGTON – A federal court has issued a permanent injunction barring Chris Elmer of Sacramento, Calif., from preparing federal tax returns for others after Oct. 14, 2010, the Justice Department announced today. U.S. District Court Judge John A. Mendez entered the order and judgment. The permanent injunction also bars Elmer’s tax-preparation company, Associated Tax Planners Inc. (ATP), and its principals (Elmer’s sons and son-in-law) from promoting a variety of improper tax schemes, and requires Elmer to divest himself of his interest in ATP. Elmer and his co-defendants consented to the entry of the permanent injunction.
The government’s complaint alleged that ATP repeatedly claimed false or inflated business deductions, many of which were allegedly claimed as purported business expenses of sham partnerships. The complaint also alleged that in many instances the defendants claimed purported partnership business losses on customers’ individual tax returns regardless of whether the customers actually had a partnership or other business enterprise. In addition, the government asserted that the defendants often did not file a corresponding partnership return when their customers reported partnership losses on their individual returns, or fabricated phony Internal Revenue Service (IRS) tax identification numbers for the partnerships to conceal their sham nature.
The terms of the court’s order also require that any of the remaining defendants (other than Chris Elmer) who wish to continue to prepare tax returns for others must pass the IRS’s enrolled agent’s examination within three years. And the injunction provides for the appointment of a neutral monitor to evaluate whether ATP in the future is abiding by the terms of the injunction.
John A. DiCicco, Acting Assistant Attorney General for the Justice Department’s Tax Division, thanked Justice Department trial attorney Brian H. Corcoran for handling the case, and also thanked Revenue Agent Dennis Brown of the IRS’s Small Business/Self-Employed unit in Sacramento.
In the past decade, the Justice Department’s Tax Division has obtained more than 470 injunctions to stop tax fraud promoters and tax return preparers. Information about these cases is available on the Justice Department website.