Federal Court Shuts Down New York Area Tax Return Preparation Business – Department of Justice

by | Oct 21, 2022 | Business

A federal court in the Eastern District of New York has permanently barred Brooklyn-based defendants Maria Cuervo and Danays Enterprises & Travel, Inc. from operating a tax return preparation business, including from their store located at 2786 Atlantic Avenue, Brooklyn, New York. Defendants consented to the permanent injunction. The judgment entered by the Court also requires Cuervo to disgorge to the United States $150,000 in fees that the Government alleged she received as ill-gotten gains for preparing federal tax returns that make grossly incompetent, negligent, reckless or fraudulent claims.Among the allegations in its complaint, the United States alleged that the defendants prepared customer’s tax returns, which reported fraudulent filing statuses, including improper claims of head-of-household status. The United States further alleged that the defendants prepared tax returns that claimed fraudulent dependent exemptions, as well as losses designed to improperly reduce reported taxable income.

Deputy Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.

Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers.  The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, inclu …

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