DOJ Sues to Bar South Carolina Return Preparer

The civil complaint against Julie E. Hueble, which was filed in the U.S. District Court for the District of South Carolina, alleges that Hueble owned and operated three Liberty Tax Service franchise locations in Greenwood and Clinton, South Carolina. According to the complaint, Hueble and the employees of her tax preparation stores prepared federal income tax returns that improperly understated customers' tax liabilities or increased customers' claims for refundable tax credits.

The complaint alleges that Hueble and her employees prepared returns for customers that, among other things, falsely reported on Schedule Cs (Profit or Loss From Business) non-existent businesses and/or inflated income or deductions. The suit further alleges that Hueble and her employees fabricated other deductions, claimed improper filing statuses and falsely claimed dependents, all of which resulted in fraudulently maximizing refunds and/or refundable credits.

In one example detailed in the complaint, Hueble falsely increased a customer's taxable income by reporting a fabricated "childcare" business, even though the customer did not own a child care business and gave Hueble no documentation showing that she did. The increased income enabled the customer to receive an inflated Earned Income Tax Credit.

The complaint states that Hueble's tax-preparation stores prepared 2,165 federal income tax returns between 2012 and 2014, and Hueble prepared 904 returns during this period. An analysis of returns filed between 2012 and 2014 revealed that the harm to the U.S. Treasury caused by Hueble's conduct could be more than $1 million, according to the suit.

Return preparer fraud is one of the IRS's Dirty Dozen Tax Scams for 2015. The IRS has some tips on its 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 and tax scheme promoters. Information about these cases is available on the Justice Department's website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on here. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.