In a significant effort to curb tax fraud and protect taxpayers, the Justice Department has filed a complaint in the U.S.Northen District Court of Texas. The complaint seeks to bar Ruben Gonzalez, a tax return preparer from the Fort Worth area, from preparing federal income tax returns for others. This action highlights the Department’s commitment to maintaining the integrity of the tax system and preventing fraudulent activities that harm both the government and taxpayers.
Details of the Allegations against Ruben Gonzalez
According to the complaint, Ruben Gonzalez and his employees, operating under the sole proprietorship “Sin Barreras Income Tax,” prepared over 14,000 federal income tax returns between 2021 and 2023. The complaint alleges that a substantial number of these returns contained deliberate falsifications designed to significantly overstate tax refunds for their clients. These purported fraudulent activities include several key schemes:
- Fabricating or Inflating Business Losses: Gonzalez and his team allegedly created or exaggerated business losses, which are used to reduce the taxable income of their clients unlawfully. This practice not only decreases the tax liability of the clients but also defrauds the federal government of rightful tax revenue.
- Falsifying Charitable Donation Deductions: The complaint accuses Gonzalez of inflating or completely fabricating charitable donations on behalf of his clients. By doing so, the preparers were able to increase itemized deductions, further reducing the taxable income and inflating refunds unjustly.
- Falsely Claiming Energy Credits: It is alleged that Gonzalez falsely claimed energy credits, which are typically reserved for taxpayers who make specific energy-efficient improvements to their homes. These credits were improperly claimed, resulting in unmerited tax benefits.
- Misappropriating Coronavirus Family Sick Leave Credits: During the COVID-19 pandemic, various relief measures were introduced to support affected individuals. The complaint highlights that Gonzalez falsely claimed coronavirus family sick leave credits, exploiting these relief measures intended for those genuinely impacted by the pandemic.
Through these deceptive practices, Gonzalez is accused of causing the United States to lose nearly $20 million in tax revenue over the two-year period from 2021 to 2023.
Official Statements and Legal Proceedings
Deputy Assistant Attorney General David A. Hubbert from the Justice Department’s Tax Division announced the complaint’s filing. The case is being handled by attorneys from the Tax Division, who are dedicated to pursuing legal action to prevent further losses and protect the integrity of the tax system. The primary goal of this legal action is to obtain an injunction that would prohibit Gonzalez and his employees from continuing to prepare tax returns, thereby preventing additional fraudulent activities and safeguarding taxpayers.
Guidance for Taxpayers
The Justice Department’s action against Gonzalez is part of a broader initiative to combat tax fraud and protect taxpayers. Taxpayers are advised to be cautious when choosing a tax return preparer. The Internal Revenue Service (IRS) provides several resources to assist in choosing a reputable preparer. These resources include a free directory of federal tax preparers, which helps taxpayers find qualified professionals. Additionally, the IRS has published 10 tips to avoid tax season fraud and measures to safeguard personal information, which can be instrumental in protecting against unscrupulous preparers.
Past Efforts and Ongoing Initiatives
This action against Gonzalez is not an isolated effort. Over the past decade, the Justice Department’s Tax Division has successfully obtained injunctions against hundreds of fraudulent tax preparers. This sustained effort underscores the Department’s dedication to upholding the law and protecting taxpayers from fraudulent schemes. Information about these cases, including an alphabetical listing of individuals who have been enjoined from preparing tax returns and promoting tax schemes, is available on the Justice Department’s website. These resources are crucial for taxpayers to verify the legitimacy of their tax preparers and avoid falling victim to fraud.
Conclusion
The filing of this complaint marks a crucial step in the Justice Department’s ongoing efforts to address tax fraud and protect taxpayers. By seeking an injunction against Ruben Gonzalez and his employees, the Department aims to prevent further losses to the United States Treasury and uphold the integrity of the tax preparation industry. Taxpayers are encouraged to remain vigilant and utilize available resources to ensure they are working with reputable tax professionals. The Justice Department’s proactive measures are essential in safeguarding the interests of both taxpayers and the federal government, ensuring a fair and just tax system for all.
