JUSTICE DEPARTMENT FILES LAWSUIT TO STOP
ALLEGED FRAUDULENT TAX PREPARER

WASHINGTON, D.C. - The Justice Department today announced that it has filed a lawsuit to bar Las Vegas, Nevada resident Jeffrey Dean Hubacek from preparing federal income tax returns.

According to the complaint, filed in the U.S. District Court for the District of Nevada, the Internal Revenue Service estimates that Hubacek has allegedly prepared returns understating customers’ tax liabilities totaling approximately $400,000. The complaint specifically alleges that Hubacek knows his activities are illegal, but nonetheless continues to prepare fraudulent tax returns for customers.

“The Justice Department is bringing civil and criminal cases against tax-scam promoters and preparers of fraudulent tax returns,” said Eileen J. O’Connor, Assistant Attorney General for the Justice Department’s Tax Division. “We are committed to stopping fraudulent tax schemes.”

The complaint alleges that Hubacek that uses a “corporate profit” scheme to file false returns. This alleged scheme is based on the frivolous argument that only corporations are subject to federal-income tax. The complaint also alleges that Hubacek places zeros in all sections of his customers’ returns, falsely reporting the customers have no income. According to the complaint, Hubacek’s scheme is the same as the one sold by infamous scam promoter Irwin Schiff also of Las Vegas. The U.S. District Court for the District of Nevada preliminarily barred Schiff from promoting the scheme earlier this year, but a federal appellate court has stayed the injunction pending appeal. Argument on that appeal is scheduled for February 2004 in San Francisco. Information on the Schiff case can be found at:
http://www.usdoj.gov/tax/txdv03357.htm
http://www.usdoj.gov/tax/txdv03167.htm
http://www.usdoj.gov/tax/txdv03157.htm.