A roundup of our favorite recent tax fraud cases.
Burley, Idaho: Preparer Cruz “Kelly” Chacon, 42, has been sentenced to 18 months in federal prison, followed by one year of supervised release, and been ordered to pay $81,384 restitution for assisting, advising, and counseling clients to submit materially false federal income tax returns to the IRS.
According to the plea agreement, from 2008 through 2011 Chacon and some of her employees at Kelly’s Tax Service submitted over 2,500 falsified federal returns. The returns primarily claimed unjustified tax credits.
Specifically, Chacon and her employees prepared returns that claimed the Child Tax Credit and the Additional Child Tax Credit for taxpayers who did not qualify. Authorities said the inflated refunds helped Chacon generate business.
She pleaded guilty in February.
East Hartford, Conn.: Preparer Shaukat G. Dalal, a.k.a. Shaukathusein Dalal, 55, has been sentenced to four months of imprisonment to be followed by six months of home confinement and three years of supervised release, for tax evasion. He was also ordered to pay a $3,000 fine and $97,289 in back taxes, plus penalties and interest.
According to court documents and statements made in court, Dalal was employed by the State of Connecticut as a fiscal administration assistant, and also owned and operated a separate prep business, Tax Preparation SVS Inc. For the 2009 through 2011 tax years, Dalal, who had prepared more than 250 returns as part of the prep business, did not deposit all of the gross receipts from the business into his business bank account and subsequently understated his gross receipts on his federal returns.
Dalal and his wife also owned Ameen LLC, a holding company that owned 25 rental units in an East Hartford condominium complex. Dalal performed virtually all of the work for the real estate business, including collecting rent receipts, pricing the units, organizing repairs and maintenance, depositing rent receipts, paying the bills and maintaining the books and records. He did not deposit a substantial portion of rent receipts, often paid to him in cash, into Ameen LLC’s business bank account and substantially underreported both the applicable income and taxes due and owing on his 2009 through 2011 federal tax returns.
Through this scheme, Dalal failed to report nearly $400,000 in income.
Last December, he pleaded guilty to one count of tax evasion. He reports to prison on July 20.
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