BATON ROUGE – The owner of a Gretna tax preparation business is the 50th person arrested under a statewide initiative to crack down on tax fraud in Louisiana.
Joyce M. Gaines of Harvey (Booking Photo) is owner of Tax Town, LLC. She is accused of filing state income tax returns containing fabricated business losses for hundreds of clients, many of whom were not business owners. The scheme resulted in more than a quarter-million dollars in fraudulent state income tax refunds.
Gaines was booked into the East Baton Rouge Parish Prison on Thursday, September 24, on charges of Filing or Maintaining False Public Records and Illegal Transmission of Monetary Funds. Two of her employees, Tamicka Kitts and Raquel Walker, were arrested on the same charges on Tuesday, September 22.
Gaines is one of dozens of tax preparers, business operators and individual taxpayers arrested since the Louisiana Department of Revenue (LDR) and the Office of the Louisiana Attorney General joined forces in 2013 to investigate and prosecute tax fraud.
When data indicated several years ago that tax fraud was on the rise, LDR hired two full-time investigators and assigned them to work with Louisiana Department of Justice on the issue.
“Louisiana taxpayers need and deserve a strong enforcement program to stop criminals from taking advantage of the system,” Secretary of Revenue Tim Barfield said. “This milestone demonstrates the investment is paying off.”
Since the joint anti-fraud crackdown began in March 2013, LDR has recovered $416,638 in court-ordered restitution of fraudulent refunds. There have been 17 criminal convictions.
“When someone cheats the system by committing tax fraud, the hard working, tax-paying citizens of Louisiana are left with the bill,” Attorney General Buddy Caldwell said. “We are achieving great results through our partnership with the Department of Revenue and will continue to take action against those who threaten the vital services we all depend on.”
The anti-tax fraud initiative is one part of a broader LDR effort to ensure the integrity of the tax refund system. Since 2014, the department has saved taxpayers more than $50 million through identity verification, restitution payments, investigation collections, refund desk audits and reviews, and the Tax Refund Intercept Program (TRIP), which stops fraudulent refunds before they are issued.
Protect yourself from fraud
Even if someone else prepares your tax return, you are legally accountable for its content. If you receive unearned refunds due to a fraudulent return, you are responsible for making restitution to the state. Protect yourself by choosing a reputable tax preparer.
Tips for selecting a preparer:
- Choose a preparer who will be available to answer questions after the return has been filed
- Find out what the preparer’s service fees are before the return is prepared
- Avoid preparers who base their fee on a percentage of the amount of your refund or who claim they can obtain larger refunds than other preparers without first reviewing your returns
- Avoid tax preparers who ask you to sign a blank tax form
- Before signing your return, carefully review it and ask questions
- Ask any tax preparer for references
- Check to see if the tax preparer has any questionable history with the Better Business Bureau, the state’s board of accountancy for CPAs or the state’s bar association
- Check to see if the tax preparer belongs to a professional organization that requires its members to pursue continuing education and holds them accountable to a code of ethics
- Check to see if the tax preparer has a proper Preparer Tax Identification Number (“PTIN”) from the Internal Revenue Service, which is necessary for filing federal tax returns
- Ensure that the IRS has not obtained a permanent injunction prohibiting the tax preparer from preparing federal tax returns
- Always question entries on your return that you do not understand; never sign a blank return
- Insist that the tax preparer sign the return and provide appropriate taxpayer information on the return
Traits of a reputable preparer:
- They ask multiple questions to determine whether expenses, deductions and other items qualify as legitimate tax deductions
- They remind clients they should keep careful and complete records in order to substantiate information contained on their tax return
- They provide their clients with a copy of their completed return for their records
They respond to contacts made by their clients in a reasonable period of time