Justice Department Seeks to Shut Down Alabama Tax Return Preparer | WPN World People News

A number of tax return preparation businesses in the Birmingham, Alabama area unlawfully understate their customers’ income tax liabilities and overstate refunds by making deliberate misstatements on the returns, according to a new civil lawsuit filed by the Justice Department on April 27. The suit, filed in federal court in Birmingham, asks the court to permanently bar Jessica Leverett aka Jessica Harris, from preparing tax returns for others. The suit also asks the court to order Leverett to turn over a list of all of the tax returns she has prepared.

According to the complaint, Leverett owns and operates a number of different tax preparation businesses in the area, including Tax Money Now, L.L.C., Dynamic Tax Services, Dynamic Tax Solutions and Express Money Tax. The government’s complaint alleges that Leverett and her associates prepared returns that fabricate self-employment businesses and business losses to offset their customers’ taxable income from other sources and to increase their customers’ Earned Income Tax Credit. When a customer does have a small business, the complaint alleges, Leverett and her associates mischaracterize the business income as household employee wages in order to avoid paying the required self-employment tax. The complaint also alleges that Leverett’s businesses claim education credits that the customers are not entitled to receive.

According to the complaint, the Internal Revenue Service (IRS) has examined 264 returns prepared by Leverett’s businesses and found that 206 understate the tax owed by Leverett’s customers by thousands of dollars on average. The complaint alleges that Leverett’s activities may have caused the United States to lose over $2.5 million in understated taxes and/or fraudulent refunds.

Source: U.S. Department of Justice