DOJ Sues to Bar Mississippi Return Preparers

The civil injunction complaint, filed in U.S. District Court for the Northern District of Mississippi, alleges that the Hardaways, of Holly Springs, Miss., have prepared federal income tax returns for customers that fraudulently understated their tax liabilities or overstated refunds by claiming frivolous fuel tax credits. According to the complaint, an Internal Revenue Service (IRS) investigation revealed that 156 income tax returns prepared by the Hardaways and audited by the IRS resulted in tax deficiencies. The lawsuit alleges that the tax harm caused by the Hardaways' misconduct exceeds $321,000 in erroneous refunds issued to taxpayers.

Return preparer fraud is one of the IRS's Dirty Dozen Tax Scams for 2013, which can be viewed at www.irs.gov/uac/Newsroom/IRS-Releases-the-Dirty-Dozen-Tax-Scams-for-2013. The IRS has tips for choosing a tax preparer: www.irs.gov/Tax-Professionals/Choosing-a-Tax-Professional. In the past ten years, the Justice Department's Tax Division has obtained injunctions against hundreds of unscrupulous tax-return preparers. Information about these cases is available on the Justice Department Website at www.justice.gov/tax/taxpress2013.htm.