The District Court for the Middle District of Florida permanently enjoined Tyrone Johnson and TJ Professional Services LLC yesterday from preparing federal income tax returns for others, from owning or operating any tax return business in the future and from transferring customer lists or other customer information.
In issuing the injunction, the court accepted as true that since 2016, the defendants prepared returns that claimed fictitious businesses and fabricated business losses so that those returns claimed larger refunds than the defendants’ customers were entitled to receive. The civil complaint alleged that the defendants’ schemes have cost the Treasury millions of dollars. The order also accepted that Johnson does not file using his Preparer Tax Identification Number (PTIN) but hides his involvement by using only the taxpayer’s identification number. According to the IRS, anyone who is paid to prepare or assists in preparing federal tax returns is legally required to have a valid PTIN and paid preparers must sign and include their PTIN on the return. Not signing a return, commonly known as “ghost preparation,” is often a red flag that a preparer is attempting to avoid detection by the IRS. The complaint alleged that Johnson acted as a ghost preparer.
The injunction against the defendants was entered by default: according to the order, both Johnson and TJ Professional Services failed to appear in the action. The court also permitted the United States to conduct post-judgment discovery to monitor compliance with its order.
Deputy Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
As the 2024 tax season approaches, taxpayers seeking a return preparer should remain vigilant against unscrupulous tax preparers. The IRS offers tips on how to accurately file returns and how to choose a tax return preparer, as well as steps taxpayers can take to get a jumpstart on filing.
Taxpayers seeking assistance can access the IRS’s free directory of federal tax preparers. The IRS also has programs offering free basic return preparation for qualifying seniors and individuals with low to moderate income. In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
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 on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.