UNITED STATES SUES TO STOP FLORIDA TAX RETURN PREPARER FROM CLAIMING ALLEGEDLY BOGUS TAX CREDITS

West Palm Beach Area Preparer’s Allegedly Bogus Claims Estimated to Cost U.S. Treasury at Least $300,000

WASHINGTON - The United States has sued Robert Cusenza, a West Palm Beach tax return preparer, seeking to bar him permanently from the tax preparation business, the Justice Department announced today. The government’s complaint asks the court to order Cusenza to stop preparing returns and to turn over his customer list to the Justice Department.

According to the government complaint, Cusenza, who operates C R Insurance Agency Inc., has prepared tax returns claiming nearly $200,000 in false fuel tax credits alone. The complaint also alleges that Cusenza prepared returns that fabricated his customers’ income and/or expenses in order to maximize the earned income tax credit and obtain refunds for his customers.

The fuel tax credit is a credit available only to taxpayers who operate farm equipment or other off-highway business vehicles. The equipment or vehicles must not be registered for highway uses; meaning, that fuel purchased by truck drivers and companies for commercial transport does not qualify. The government complaint alleges that Cusenza fraudulently claims this credit for highway drivers who are not qualified to receive the credit. Moreover, according to the complaint, Cusenza claimed absurdly large credits for his customers by falsely reporting purchases of huge quantities of gasoline. For example, the complaint asserts that Cusenza claimed that one customer purchased 48,000 gallons of gasoline for “off-highway business use of gasoline” and “other nontaxable use of gasoline.” The complaint further asserts that, assuming $2.00 per gallon, the customer would have had to spend approximately $96,000 to purchase that amount of gasoline, despite reporting only $12,012 in income.

The complaint also alleges that Cusenza claimed a variety of other bogus deductions, like home mortgage interest. On one return, detailed in the complaint, Cusenza claimed that a husband and wife who collectively made $17,878 in wages and $780 in business income had the means to pay and were entitled to deduct $2,132,287 in interest on their home mortgage.

Over the past decade, the Justice Department has obtained injunctions against more than 375 tax return preparers and tax-fraud promoters. Information about the Justice Department’s Tax Division and its efforts to enjoin tax return preparers and tax-fraud promoters is available on the Justice Department Web site.