Justice Department Seeks to Permanently Shut Down California Tax Preparer and Convicted Felon
The United States has asked a federal court in Sacramento, California, to bar a Ripon, California, man from preparing tax returns for others, the Justice Department announced today.
According to the government’s complaint, Sarad Chand has repeatedly prepared federal tax returns that understate his customers’ federal tax liabilities.
The complaint alleges that Chand, and others working with him under the business name S. Chand Tax & Accounting Services, prepared tax returns that falsely claimed inflated or fabricated tax credits or deductions. The suit notes that Chand most frequently prepared returns that falsely inflated unreimbursed employee business expenses. Chand also created Schedule Cs (Profit or Loss From Business) with false income, while for other clients he created false losses or inflated expenses, according to the suit. According to the complaint, these fabrications served to improperly reduce the customers’ taxable income and resulted in reduced tax liability or inappropriate tax refunds. Moreover, according to the complaint, Chand also led his customers to believe that he was a former Internal Revenue Service (IRS) employee, when he was not.
The suit also notes that on May 15, 2014, Chand pleaded guilty to aiding and assisting in the preparation and presentation of a false and fraudulent tax return in United States v. Chand, et al., Case No.1:12-CR-00425 (E.D. Cal.). As part of his plea agreement, Chand agreed to the entry of a permanent civil injunction, according to the complaint.
The suit alleges that the IRS has completed examinations of 919 of the approximately 8155 tax returns Chand prepared from 2008 to 2012, and that nearly all of the examined returns resulted in a finding of deficiency or denial of a refund claim. The total tax understatement from the 886 returns found to be inaccurate totaled more than $2.7 million.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams for 2015. 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 and tax scheme promoters. 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.