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Monday, May 5, 2014

Chicago Federal Court Shuts Down Tax Preparer

Return Preparer Allegedly Deducted Phony Expenses from Fake Businesses

A federal court in Chicago permanently barred Barbara L. Garrett from preparing tax returns for others or working for any business that prepares tax returns for others, the Justice Department announced today.  The court’s injunction, filed in the U.S. District Court for the Northern District of Illinois, also requires Garrett to contact and provide a copy of the injunction order to every customer for whom she prepared a tax return since 2011.  Garrett agreed to the permanent injunction, which was entered against her by the court on April 30, 2014.

The complaint alleged that Garrett, while working at multiple Chicago-area tax preparation businesses, including Instant Tax Service, Preferred Financial and Income Tax Solutions, claimed fraudulent deductions and credits on her customers’ federal tax returns.  Examples cited in the complaint include returns prepared by Garrett for customers that falsely claimed thousands of dollars in bogus deductions from entirely fake businesses.

Return preparer fraud is one of the IRS' Internal Revenue Service's Dirty Dozen Tax Scams for 2014 .  The IRS has some tips on their website for choosing a tax preparer.  In the past decade, the Tax Division has obtained injunctions against hundreds of fraudulent tax preparers.  Information about these cases is available on the Justice Department 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.

Related Materials:

United States v. Barbara L. Garrett
Complaint for Permanent Injunction and Other Relief
Amended Final Judgment of Permanent Injunction

Press Release Number: 
Updated July 7, 2016