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Friday, February 13, 2009

U.S. Asks Federal Court to Shut Down Iowa Tax Preparers

Couple Allegedly Claim Bogus "Business Expenses" on Customers’ Returns, Including Expenses for a Wedding

WASHINGTON — The United States has sued a Clive, Iowa, couple to bar them from preparing federal tax returns for others, the Justice Department announced today. According to the government complaint, Jill Schwartz-Musin, her husband Howard Musin, and their business, SSC Services, prepare fraudulent federal income tax returns for small business owners.

The complaint alleges that the couple prepares income tax returns for customers throughout the nation, many of whom operate home-based businesses. According to the complaint, Schwartz-Musin promoted her tax business at an annual conference for Shaklee Corporation distributors.

The complaint also alleges the couple claim fabricated business expenses on customers’ returns —sometimes for tens of thousands of dollars —in order to reduce their taxes. The suit alleges the couple improperly claimed business expense deductions on customers’ returns for costs of such personal items as clothing, hair care, nail care, use of tanning salons, a hot tub, furniture in a vacation home, gifts to family members and vacation trips to Sweden and Cancun, Mexico. In what the complaint calls an egregious example of misconduct, the couple allegedly claimed business deductions on one customer’s return for wedding expenses that included payments for flowers, photography and makeup.

The government alleges that Schwartz-Musin and Musin have prepared over 5,500 income tax returns between 2003 and 2006. The complaint estimates that the fraudulent deductions on returns the defendants prepared have cost the United States over $21 million between 2003 and 2007.

Over the past decade, the Justice Department has obtained injunctions against more than 370 tax preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website.

Press Release Number: 
Updated September 15, 2014