Florida Tax Preparer Facing Decades in Prison for Filing False Returns, Wire Fraud, Identity Theft

According to a Department of Justice (DOJ) press release issued February 23, 2018, former tax preparer Manuel Antonio Severino, 44, of West Palm Beach, Florida, is facing decades in federal prison after being found guilty on 17 counts of assorted federal felonies, including: (1) 13 counts of aiding and assisting in the preparation of false tax returns, a felony violation of 26 U.S. Code § 7206(2) (fraud and false statements); (2) two counts of aggravated identity theft, a felony violation of 18 U.S. Code § 1028A(a)(1) (aggravated identity theft); and (3) two counts of wire fraud, a felony violation of 18 U.S. Code § 1343 (fraud by wire, radio, or television). The sentencing hearing, at which Severino will appear before Senior U.S. District Judge Paul C. Huck, is currently scheduled to take place on May 18, 2018. The stakes will be high for Severino, who faces a daunting sentence of two years per count of identity theft, up to three years per count of filing a false tax return, and up to 20 years per count of wire fraud.

Tax Preparer Illegally Claimed False Credits and Deductions

Court records describing the trial evidence used against Severino paint a picture of a calculated, extensive tax fraud scheme. Assistant U.S. Attorneys Daniel J. Marcet and Lisa Miller, who prosecuted the case against Severino in United States District Court for the Southern District of Florida, successfully demonstrated that the defendant, acting over an approximately three-year period, took the following actions:

  • While operating a tax preparation business from his West Palm Beach residence, Severino prepared and filed false personal income tax returns on behalf of clients, “claiming false and fraudulent credits and deductions” for the purpose of “unjustly enrich[ing] himself and others.” For example, on several returns, Severino knowingly and falsely claimed that ineligible taxpayers qualified for the American Opportunity Tax Credit (AOTC), a tax credit of up to $2,500 available for students who meet certain criteria. Over the three years in which he operated the tax preparation service, Severino “sought over $1.6 million in refunds from the IRS on behalf of himself and his clients.”
  • Taxpayers who, like Severino, improperly attempt to claim the AOTC face serious financial consequences, leading the Internal Revenue Service (IRS) to issue the following warning: “If the IRS audits your return and finds your AOTC claim is incorrect and you don’t have the documents to show you qualified, you must pay back the amount of the AOTC you received in error with interest. The IRS may also charge you an accuracy or a fraud penalty. Or, you can be banned from claiming the AOTC for two to ten years.” Where appropriate, the AOTC may be claimed using Form 8863 (Education Credits (American Opportunity and Lifetime Learning Credits)), which should be attached to your federal income tax return for submission to the IRS.
  • In addition to claiming false credits and deductions, Severino, acting without his clients’ knowledge, “diverted portions of his clients’ tax refunds to bank accounts that Severino controlled”: an unspecified amount totaling “tens of thousands of dollars” according to the DOJ press release.

Criminal Tax Defense Lawyers Representing CPAs and Tax Preparers

Severino’s case, like others our criminal tax defense attorneys have profiled, is a reminder of the dire financial, legal, and professional consequences a tax preparer or CPA can face when charged with willful violations of the Internal Revenue Code. In addition to the hefty penalties facing other tax crime defendants, such as prison time, supervised release, fines, and restitution orders, tax professionals risk the added peril of irreversible career damage, which can come in the form of disciplinary actions, disbarment, removal of the right to practice by OPR, or other serious sanctions.

Whether you are a tax preparer who has been charged with fraud, a taxpayer who is concerned about the accuracy of your previous tax returns, or simply an individual who is seeking precise and competent tax preparation services for California or federal taxes, look to the Tax Law Office of David W. Klasing for zealous, client-focused support. Backed by more than 20 years of experience handling tax matters ranging from felony tax evasion charges to bookkeeping services for small businesses, our versatile, award-winning team of CPAs and tax attorneys is well-versed in all aspects of Tax Code and IRS procedure, enabling us to provide the comprehensive guidance and aggressive advocacy you need. To learn more about how our nationally-recognized team of tax professionals can assist you or your business with a local, state, federal, or international tax issue, contact the Tax Law Office of David W. Klasing online, or call our law offices at (800) 681-1295 for a reduced-rate consultation.

Also, we’ve expanded our offices! In addition to our offices in Irvine and Los Angeles, the Tax Law Offices of David W. Klasing now have offices in San BernardinoSanta BarbaraPanorama City, and Oxnard! You can find information on all of our offices here.

 

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What is an effective tax defense in an IRS eggshell tax audit?

https://www.youtube.com/watch?v=7qixPqWTtvA

So, you cheated on your taxes and you are under a tax audit…

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Why should I hire a tax attorney to represent me in a tax audit?

https://www.youtube.com/watch?v=NDwc4GUfBX8

Foreign income and information non-compliance

https://www.youtube.com/watch?v=g2UlIE8oxPA

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