1040 tax form with calculator and dollar bills(Photo: PKSTOCK)
KUSA - A federal court permanently closed down a tax preparation business in Colorado
after its owner allegedly reported extra dependents and bogus deductions for its customers.
The United States filed a civil complaint against Gerardo Herrera and his business, El Lobo Multiservicios Professionales Inc. According to the complaint, Herrera and his staff repeatedly claimed their customers' extended family members as dependents, even though they didn't qualify, and improperly claimed deductions for personal expenses, like car insurance and cell phones.
The complaint also states that audits have shown Herrera and his staff exaggerated deductions, reported fraudulent charitable contribution deductions and claimed improper head-of-household filing status. The complaint alleges the Internal Revenue Service audited more than 200 returns prepared by the business and found misrepresentations on more that 99 percent of them.
Herrera's business was closed after he failed to respond the the civil complaint Thursday.
He is permanently banned from preparing returns.
To avoid getting caught in a scam, the IRS gives these tips for choosing a tax preparer: http://1.usa.gov/1OLheeI
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