Laredo Tax Preparer Nets 36-Month Stint {for Aiding and Assisting in False Tax Returns}

Lexington, KY, Herald-Leader ^ | 01-16-04 | Staff

[Theodore R.]

Tax preparer nets 36-month stint

From staff reports

A Laredo woman has been sentenced to serve 36 months in federal prison for aiding and assisting in the preparation of false federal income tax returns.

U. S. Atty. Michael Shelby announced Wednesday that the woman, Sandra Luz Castro, was assessed the prison term without parole.

In addition to the prison term, U. S. District Judge Keith P. Ellison assessed Castro one year of supervised released after she leaves prison. The woman also must pay $1,500 in special assessment into the Federal Crime Victim's Fund and $11,636.82 as costs of prosecution.

The sentence also ordered the woman not to assist in the preparation of any income tax returns during her period of supervised release.

A Laredo federal court jury found Castro guilty on August 15, 2003, on 15 counts of aiding and assisting in the preparation of false tax returns. The trial lasted eight days.

The government introduced evidence that proved Castro, a tax preparer, falsified numerous line items in each of her paying clients' U.S. Individual Income Tax Return Forms 1040 and 1040A for the tax years 1997 and 1998.

The fraud included unlawfully splitting married couples' returns and filing the husband as "married filing separate" and the wife as "head of household."

It also included filing false itemized deductions on several 1040 income tax returns, including filing numerous false itemized deductions on Schedule A worksheets, as well as falsely claiming education and child and dependant care credits.

Castro prepared all of these false items without the knowledge or assistance of her clients.

All of the falsely claimed items resulted in larger than authorized refunds for the clients, of which Castro charged 10 percent in advance as part of her standard fee arrangement.

Castro came to the attention to the IRS which led to an investigation by the Internal Revenue Service-Austin Service Center Questionable Refund Detection Team, the Internal Revenue Service-Criminal Investigation Division, Internal Revenue Service-Examination Division.

Dixie A. Morrow and Arthur R. Jones, assistant U. S. attorneys for the Laredo Division of U. S. District Court, handled the prosecution.

01/16/04

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