The U.S. Department of Justice has filed a legal complaint in a federal court in the Southern District of Florida to shut down tax return preparers Cedric Reid and Juan Santana, along with their business Advance Tax Group Inc. The government is seeking to stop them from preparing federal income tax returns for others.
According to the complaint, the defendants operate from offices in Daytona Beach and Ocala, Florida. Authorities allege that their tax preparation work included false and misleading information on returns filed for customers. The Justice Department is asking the court to issue an injunction to permanently bar them from continuing these services.
This legal step is taken when authorities believe immediate action is needed to prevent further harm. In this case, the concern is that incorrect tax filings may impact both taxpayers and government revenue. The complaint clearly focuses on stopping the alleged activities as soon as possible.
Allegations of False Claims and Misuse of Tax Credits
The complaint outlines serious allegations against Cedric Reid, Juan Santana, and Advance Tax Group Inc. It claims they prepared tax returns with incorrect details to reduce the amount of tax owed by clients and to claim refunds that were not allowed.
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One major issue involves the misuse of filing status. Filing status affects how much tax a person must pay. The complaint states that incorrect statuses were used to gain financial advantages for customers.
Authorities also allege that false or inflated business expenses were reported. By increasing expenses on paper, taxable income appears lower than it actually is. The complaint further mentions false reporting of business losses, which can reduce tax liability even more.
In addition, the defendants are accused of claiming improper tax credits. These include fuel tax credits, education credits, and other credits that were allegedly not valid. Tax credits directly reduce the tax owed, making them a key area of concern in the complaint.
A key focus is the Earned Income Tax Credit (EITC), which is meant to support low- and moderate-income workers. The complaint alleges that false information was used to increase EITC claims. It also states that required due diligence rules set by the Internal Revenue Service were not followed when preparing these claims.
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$7 Million Tax Loss and Enforcement Action
The government estimates that the actions of Cedric Reid, Juan Santana, and Advance Tax Group Inc. led to a tax loss of more than $7 million in 2023 and 2024. This includes taxes that were underpaid as well as refunds that were wrongly issued.
The announcement was made by Joshua Wu of the Civil Division’s Tax Litigation Branch. The case is being handled by attorneys Meredith Hollman and Amanda Cornwell.
Officials are reminding taxpayers to stay alert when choosing a tax return preparer. Incorrect filings can lead to penalties, audits, and other serious issues. Even if a preparer completes the return, the taxpayer remains responsible for the accuracy of the information submitted.
The Internal Revenue Service provides guidance to help people select trusted preparers and has launched a free online directory of federal tax preparers. This tool is designed to help taxpayers find qualified professionals.
Over the past decade, the Justice Department has obtained injunctions against hundreds of dishonest tax preparers. These actions are part of ongoing enforcement efforts to stop fraudulent tax practices.
The department also maintains a public list of individuals and businesses that have been barred from preparing returns or promoting tax schemes. Authorities have asked that if anyone believes an enjoined person or business is still operating, they should contact the Civil Division’s Tax Litigation Branch with detailed information.
