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July 24, 2009

TAX RETURN PREPARER SENTENCED FOR FILING FALSE RETURNS AND FOR DUPING CLIENT

(HOUSTON) - Tax return preparer Dennis Lane Estes has been sentenced to 30 months for evading the income taxes of one of the clients, United States Attorney Tim Johnson announced today. Estes, of Tejas Income Tax Services, previously pleaded guilty and will pay restitution the Internal Revenue Service in the amount of $296,306 and serve three years of supervised release. The sentence was imposed today by United States District Judge Melinda Harmon.

According to the plea agreement filed in the public record of the case Jan. 9, 2009, Estes was hired by an individual to prepare corporate and individual income tax returns for years 2001 through 2004. Each year, without the client’s knowledge, Estes filed the corporate and individual income tax returns with the Internal Revenue Service falsely underreporting the amounts of taxable income on both and falsely understating the amounts of individual income taxes owed by the client. Each year, Estes gave the client a different set of corporate and individual income tax returns showing significantly more taxable income on both and significantly more individual income taxes owed by the client. Under the guise that Estes would deliver the alleged tax payments to the IRS on the client’s behalf, Estes each year had the client write a check to Estes’ income tax preparation business for the amount of taxes reflected on the individual income tax returns given to the client. Estes pocketed the alleged tax payments that the client gave him.  

Estes also admitted in the plea agreement that he willfully filed false individual income tax returns for himself for years 2001-2003 and 2005 and that failed to file an income tax return for 2004. Estes admitted the total tax loss he caused the IRS was $296,306. Today, at sentencing, the court found that Estes actually failed to file returns in 2001-2002 and 2004, while he filed false returns in 2003 and 2005.

This case was prosecuted by Charles J. Escher of the Houston office and was investigated by the Internal Revenue Service – Criminal Investigation.

 

 

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