Two tax preparers pleaded guilty Friday to filing fraudulent tax returns for their clients so that they could charge them more, costing the federal government more than $3.5 million.
According to federal investigators, Joseph Racine, 37, and Arnouse Merlien, 40, both of Florida, misrepresented to the IRS that their clients were qualified to receive certain tax credits and deductions on federal tax returns. Racine owns JSR Westend Tax Services in Atlanta.
In 2016, the IRS identified Racine’s company as potentially filing fraudulent tax returns between 2013 and 2015, the U.S. Attorney Byung J. “BJay” Pak said in a news release. Racine requested refunds on 99 percent of the returns, including fuel tax credits, refundable education credits and unreimbursed employee business expenses.
Last year, the IRS determined that JSR Tax Services in Florida, also owned by Racine and where Merlien worked, was filing returns with the same patterns of fraud as Racine’s other company.
Racine and Merlien are scheduled for sentencing in Sept. 6.
“Tax preparers and others who steal from the public fisc by deliberately devising schemes to cheat the system will be vigorously prosecuted,” Pak in the release.
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