Texas Return Preparer Sentenced to Jail for Preparing False Tax Returns
Continued to Prepare False Returns after Being Indicted
Eddye L. Lovely, a tax return preparer from Tomball, Texas, was sentenced today to 57 months in federal prison, the Justice Department and Internal Revenue Service (IRS) announced. Lovely appeared before U.S. District Judge Nancy F. Atlas in Houston.
On April 6, 2011, Lovely was indicted on 14 counts of aiding and assisting in the preparation of false tax returns. On Sept. 28, 2011, Lovely was charged, pursuant to a superseding indictment, with 16 counts of aiding and assisting in the preparation of false tax returns comprising the original 14 counts plus two additional counts. According to the superseding indictment, the court had released Lovely on bond pending trial and ordered him not to prepare any tax returns or commit additional crimes. While on pre-trial release, Lovely aided and assisted in the preparation of materially false 2010 tax returns for two additional clients. He pleaded guilty on Dec. 12, 2011 to three of the 16 counts charged in the superseding indictment. Following a pretrial hearing, the court revoked Lovely’s bond and ordered him detained.
According to the superseding indictment and plea agreement, Lovely owned and operated “The Tax Master,” a tax return business located in Harris County, Texas. Lovely prepared tax returns that contained fabricated Schedule C losses for businesses that the taxpayers did not own or operate, as well as false or inflated Schedule A deductions for charitable contributions and other expenses.
The court found that the tax loss associated with the three charges to which Lovely pleaded guilty as well as all relevant conduct associated with this case was more than $1 million.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, commended the investigative efforts of the IRS agents involved in the case and Tax Division Trial Attorneys Tracy Gostyla and Kathryn Ward, who prosecuted the case.