Justice Department Seeks to Bar Former Owner of Brooklyn, N.Y., Tax Firm from Preparing Federal Tax Returns
Lawsuit Alleges Tax Loss as High as $78 Million from Improper Return Preparation
WASHINGTON - The United States has filed a lawsuit against Annie P. Williams to bar her from preparing federal tax returns for others, the Justice Department announced today. The government complaint in the civil injunction suit alleges that Williams, the former proprietor of tax preparation firm PPH Tax & Realty Inc. in Brooklyn, N.Y., employed part-time tax preparers who had little or no tax experience and fostered an environment in which fraudulent return preparation was encouraged.
According to the complaint, Williams’ preparers claimed false expense and charitable contribution deductions, bogus dependents, unallowable child and childcare tax credits, and other improper tax credits on customers’ federal income tax returns. The complaint also alleges that firm employees sold other persons’ names and Social Security numbers to customers so that the customers could falsely report that those individuals were their childcare providers for purposes of falsely claiming the childcare tax credit. Employees also allegedly sold fake charitable contribution letters to customers to present to the Internal Revenue Service (IRS) during audits to substantiate false deductions.
According to the complaint, the amount of tax loss resulting from Williams’ improper tax-preparation activities could be as much as $78 million from 2006 through 2009.
The complaint alleges that Williams’ involvement in illegal tax preparation practices spans more than a decade, beginning in Mississippi where she allegedly trained employees of a tax preparation firm operated by her son, Lenardo Carzette Brown, to prepare fraudulent tax returns. The complaint also states that in 2005 a federal court in the Northern District of Mississippi permanently enjoined Brown’s business and its owners from preparing returns. The complaint also alleges that in March 2010 Williams pleaded guilty to federal tax evasion and was sentenced to six months in prison.
In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of tax return preparers and tax fraud promoters. Information about these cases is available on the Justice Department website .