COLUMBUS — A Columbus-based tax preparer has pleaded guilty in federal court to charges that she submitted false claims for tax credits for her clients and also failed to pay her own personal taxes.
Nadine Word, 35, pleaded guilty Thursdayto one count of aiding and assisting in the preparation and presentation of false and fraudulent individual income tax returns and one count of willful failure to file return, supply information, or pay tax before U.S. District Judge Clay Land.
Word faces a maximum of three years imprisonment to be followed by one year of supervised release and a $100,000 fine for the first count and a maximum sentence of one year imprisonment to be followed by one year of supervised release and a fine of $25,000 for the second count.
Sentencing is scheduled for June 13. There is no parole in the federal system.
“Tax preparers have an ethical and legal obligation to file correct tax returns for their clients, and should — of course — be paying their own taxes,” U.S. Attorney Peter D. Leary said in a news release. “This kind of fraud greatly harms the public trust; individuals in the Middle District of Georgia caught illegally gaming the system by making up false claims to reap larger refunds or pay less taxes than everybody else will be held accountable at the federal level.”
“Nadine Word pleaded guilty to preparing and submitting false tax returns and failing to file her personal tax returns,” James E. Dorsey, special agent in charge of the IRS Criminal Investigation Atlanta Field Office, said. “As tax season is currently underway, citizens should be reminded that committing tax fraud will lead to criminal prosecution.”
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According to court documents, between at least 2014 and 2018, Word prepared and submitted fraudulent tax returns out of her tax preparation business, Superior Taxes. These fraudulent returns resulted in greater tax refunds for Word’s clients and greater fees for Word, amounting to a total loss of $586,565. Word would submit fraudulent claims for earned income credits, education credits and business losses. She also failed to file her own tax returns during that time period.
The most common fraudulent claim Word submitted was for education credits for individuals who did not attend the school listed on the Form 8863 submitted with the Form 1040 tax return.
An analysis of tax returns claiming education credits revealed that 408 of 494 claims filed by Word had no supporting education records at the documented educational institution. The falsely submitted education credits from these 408 claims resulted in a tax loss of $556,145. Additionally, the IRS evaluated 31 individual returns finding false education credits, false earned income credits and false business expenses.
Every return included at least one false item. The tax loss for those 31 returns is $64,767. The total tax loss from the false education credits and the 31 individual returns, discounting duplications from the false education credits, is $586,565.
The case was investigated by IRS. Assistant U.S. Attorney Amy Helmick is prosecuting the case for the government.
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