Former Chicago-Area Return Preparer Sentenced to Prison for Filing False Tax Returns

A former Illinois woman was sentenced today to 14 months in prison for willfully preparing false tax returns on behalf of her clients.   

According to court documents and statements made in court, Erica Early, formerly of Robins and Richton Park, Illinois, operated a tax preparation business for clients located in Illinois, Wisconsin and Indiana, and often charged $1,000 to prepare basic, uncomplicated tax returns. Early falsely inflated her clients’ income to maximize the Earned Income Tax Credit and falsely claimed education-related credits on their behalf. Early, who was a U.S. Postal Service employee during some of the time she was engaged in preparing the false returns, also falsified her own tax returns, claiming education credits she knew she was not eligible to receive.

Early concealed her scheme by preparing clients’ returns as a “ghost preparer,” marking them as self-prepared instead of identifying herself as the paid preparer. Initially, Early directed her fees and client refunds to her personal bank account that was then closed by the bank after detecting fraudulent activity. Early then began requiring her clients to obtain prepaid debit cards in their names that Early would use to deposit her clients’ refunds as well as receive her preparation fee, avoiding the use of traditional banks.

In addition to the term of imprisonment, U.S. District Judge Elaine E. Bucklo for the Northern District of Illinois ordered Early to serve one year of supervised release and to pay $515,990 in restitution to the United States.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement.

IRS Criminal Investigation investigated the case.

Assistant Chief Matthew J. Kluge and Trial Attorney Boris Bourget of the Tax Division prosecuted the case.