It was a busy week for the bozo side of the tax profession. Three preparers found themselves in hot water, and in one case some customers will be decoded into the mess.
First, from Beaufort, South Carolina, Sally Berry, the owner of Berry’s Bookkeeping and Tax Service allegedly liked sales tax. However, she also allegedly didn’t like to remit it to South Carolina. The South Carolina Department of Revenue also alleges that Ms. Berry underreported the amount of sales tax due on clients’ returns. Ms. Berry faces up to 34 years in prison if convicted on all ten charges that she faces.
Next, Henry Omozee operated HO Tax Services and Accounting Services in Woodbridge, Virginia. He was found guilty on three counts of filing false tax returns. He underreported his own income on his tax returns from 2001 through 2003 to the tune of nearly $85,000 in tax. He could get up to three years at ClubFed when he’s sentenced later this year.
Finally, Sharon Kukhahn had a sure-fire way to avoid income tax. Just buy her “IMF Decoder” and you wouldn’t have to pay income taxes. Only one problem—there’s no such thing and this was yet another phony scheme to avoid taxes. The Department of Justice estimates that the government has lost $4.9 million to this scheme. Ms. Kukhahn received a permanent injunction to stop selling the scheme, and she must provide a list of her customers to the government. So if you paid between $1,750 and $3,195 for her package you’ll get something else in the mail soon—A “Dear Valued Taxpayer Letter” letting you know that your return has been selected for audit.
One final thing about Ms. Kukhahn. She displayed some chutzpah; after the DOJ filed suit against her she told her customers that she had transferred funds to the DOJ to compensate her customers. As you’d expect, there was no transfer of any money and the 328 customers who wrote the DOJ are out of luck. Well, since the DOJ (and likely the IRS) already has their names and addresses they might get some bad luck—they’ll probably be among the first to be audited over this scheme. For as usual if it sounds too good to be true it probably is.
[…] I’ve written about Sharon Kukhahn before. Ms. Kukhahn thought that there was some magical way to decode your IRS file and magically make your taxes disappear! Ms. Kukhahn sold her packages to the public and pocketed $2,000 – $3,000 per sale. As P.T. Barnum said, “There’s one born every minute.” […]