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Friday, April 8, 2016

Justice Department Sues to Stop Mississippi Tax Return Preparer from Preparing Federal Tax Returns for Others

Return Preparer in De Kalb, Mississippi, Allegedly Overstated Refunds through
Fictitious or Exaggerated Business and Farm Losses and Tax Credits

Christopher Chamberlin, a tax return preparer in De Kalb, Mississippi, has prepared income tax returns for customers that fraudulently overstate the customers’ refunds, according to a civil complaint filed by the Justice Department today.  The complaint asks the U.S. District Court for the Southern District of Mississippi to permanently bar Chamberlin from preparing tax returns for anyone other than himself. 

According to the complaint, Chamberlin is the sole proprietor of C&T Services LLC, located in De Kalb.  The complaint alleges that Chamberlin prepared returns that fraudulently overstated refunds by reporting fictitious or exaggerated expenses on Schedule C, Profit or Loss from Business (Sole Proprietorship) and Schedule F, Profit or Loss from Farming.  The falsely claimed Schedule C and Schedule F expenses in turn generated losses that purportedly qualified Chamberlin’s customers to receive or increase the earned income tax credit (EITC) or to otherwise create or maximize refunds, according to the complaint.  Based on audit adjustments the Internal Revenue Service (IRS) has made to tax returns prepared and filed by Chamberlin for tax years 2012 and 2013, the suit alleges, the United States estimates that the defendant’s conduct may have cost the U.S. Treasury over $1 million for those years alone.

Return preparer fraud is one of the IRS’s 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 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.

Press Release Number: 
Updated April 8, 2016