Tax Return Preparer Charged with Preparing False Tax Returns for Customers
Las Vegas, Nev. – A tax return preparer in Las Vegas has been indicted by the Federal Grand Jury on multiple counts of felony tax fraud for aiding in the preparation and filing of false and fraudulent tax returns of customers, announced Gregory A. Brower, United States Attorney for the District of Nevada.
"Individuals who commit tax fraud, including those who prepare returns for others, risk criminal prosecution," said U.S. Attorney Brower. The U.S. Attorney's Office in Nevada is committed to the investigation and prosecution of those individuals who defy the federal tax laws."
Caroline Reyes, 51, who operated "Carol's Tax Service" and "Central Tax Service," out of her personal residence in Las Vegas, was indicted on April 9, 2008, and charged with 20 counts of Aiding and Assisting in the Preparation of a False and Fraudulent Tax Return. According to the Indictment, during the years 2002 through 2004, Reyes prepared numerous false and fraudulent individual federal tax returns and amended individual federal income tax returns for taxpayers by inflating itemized deductions and creating false itemized deductions, including medical expenses, gifts to charity and employee business expenses. Reyes charged approximately $100 to prepare each tax return. Reyes knew that the taxpayers were not entitled to the deductions at all, or were entitled to them in lesser amounts. The false deductions resulted in reduced income tax liabilities and often unwarranted refunds for the taxpayers. It is also alleged that in response to IRS correspondence audits of Reyes' clients, Reyes submitted false receipts to the IRS in an attempt to substantiate the false and fraudulent tax returns that she had prepared. The Indictment indicates that the amount of false deductions contained in the returns of 10 taxpayers for the tax years 2000 through 2003 is approximately $348,402.
"While most return preparers provide excellent service to their clients, a few unscrupulous tax preparers file false and fraudulent returns to defraud the government, the tax paying public and their own clients," said Sam Holland, Supervisory Special Agent for IRS Criminal Investigation in Nevada. Taxpayers should remember that no matter who prepares your tax return, you are ultimately responsible for all of the information on your tax return."
If convicted, Caroline Reyes faces a maximum of three years in prison and a $250,000 fine on each charge. She is scheduled for an initial appearance and arraignment and plea on Friday, April 18, 2008, at 8:30 a.m. before U.S. Magistrate Judge Leen.
The case is being investigated by IRS Criminal Investigation and prosecuted by Assistant United States Attorney Nicholas D. Dickinson.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.