Source: United States Attorneys General
Note: view complaint here.
The Justice Department filed a complaint today in U.S. District Court for the Northern District of Texas to permanently bar Maxumus Tax LLC and its owner and tax return preparer James Carroll III from preparing tax returns for others. Maxumus Tax allegedly operates a tax return preparation store located in Fort Worth, Texas, and serves customers online.
According to the complaint, Maxumus Tax prepared customers’ tax returns that inflated by more than $5 million claims for tax credits enacted to combat the economic impact of the COVID-19 Pandemic. Further, Maxumus Tax allegedly fabricated business losses on tax returns, including by concocting entirely non-existent businesses, to fraudulently reduce reported taxable income. Between 2021 and 2024, Maxumus and Carroll prepared more than 7,000 income tax returns, according to the complaint.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams, and taxpayers seeking a return preparer should remain vigilant. The IRS has information on its website for choosing a tax preparer, 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 checklist of things to remember when filing income tax returns.
In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found here. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.