Federal Court Bars Two Fraudulent Tax Return Preparers

A federal court in Charleston, South Carolina, has permanently barred two women from preparing federal tax returns for others, the Justice Department announced.

According to a civil complaint filed by the United States, Latasha Failey and her sister Latoya Windham prepared federal income returns in North Charleston from 2009 to 2012.  They continually and repeatedly prepared income tax returns that claimed false deductions or credits in order to understate their customers’ tax liabilities, the complaint alleged.  The defendants falsely claimed education credits; child and dependent care credits; itemized deductions on Schedule A; and dependency exemptions, according to the complaint.  In 2013, Failey and Windham each pleaded guilty to two counts of aiding and assisting in the preparation and presentation of a false income tax return and were sentenced to prison and probation, respectively, the complaint states.

The court’s order also requires Failey and Windham to give the United States a list of all of their return preparation customers since Jan. 1, 2013.

Return preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2016.  The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers.  In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers.  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.