Thursday, March 01, 2012

West Side Tax Preparer Defrauding IRS With Bogus Education Tax Credits To Inflate Tax Refunds For Clients

Wow. The FBI should be swarming all over the offices of Prime Time Tax Service on Indianapolis' west side after this report by WRTV Call 6's Rafael Sanchez. The tax preparer appears to be preying on Indianapolis' Hispanic community by offering its clients the best tax refunds in the country. The couple, Bernard and Omega Chatyoka, are inflating their clients' tax refunds by thousands of dollars when they prepare their tax returns by falsely claiming for them the American Opportunity Tax Credit, which allows taxpayers to reduce their taxes up to $2,500 for college-related expenses. The problem is that none of the taxpayers with whom Sanchez spoke actually had college-related expenses. Even worse, when the taxpayers show up to get their tax refunds, the company appears to be charging them contingency fees as high as 20% of their refunds.

A tax preparer on Indianapolis' west side is accused of putting false information on tax returns to inflate refunds by thousands of dollars, in some cases.
A tip about long lines outside the office led RTV6 to investigate why so many people were going there and why many were convinced the tax preparer would get them larger refund amounts.
Call 6 Investigator Rafael Sanchez found that a couple of Prime Time clients have received a two-page letter from the Internal Revenue Service that says, in part, "We have received your income tax return and are holding your refund until we complete a thorough review of your return."
A representative for Bernard and Omega Chatyoka, owners of Prime Time, promised they would respond to the Call 6 Investigators, but they didn't.
In some cases, Prime Time signed up customers for the American Opportunity Tax Credit, which allows families to cut their taxable income by up to $2,500 for college-related expenses.
Lilian Villatoro, of Indianapolis, has two children ages 13 and 8. She said she soon realized that her tax return didn't add up and was surprised to receive $1,900 in college tax credits.
"They are in public school," she said. "Of course (they don't go to college). They're little."

Villatoro said she went to Prime Time Tax Service on Jan. 25 and handed in her tax forms from last year. The process took just a few minutes, Villatoro said, and a few days later, she found that she had been signed up for the college tax credit.
In Villatoro's case, the tax break boosted her refund to $5,070, twice what she normally gets. Villatoro said she was shocked by the fees the company tacked on.

"(A female employee) told me that I'm going to get $4,000," Villatoro said.
The Call 6 Investigators spoke to customers who said that once their refund check arrived at Prime Time, the company would charge up to $1,000 in fees.
Villatoro said some of her acquaintances didn't mind paying the fees because they were still getting more money than they had expected.
One woman who didn't want to be identified told the Call 6 Investigators that she went to Prime Time on Jan. 23 because others told her that she could get a big refund.
The woman has three dependent children, and Prime Time put her down for $2,326 in college tax credits, though her children aren't old enough to be in high school.
Based on the information in the return, the woman's refund was set for $6,659, but she recently received a letter from the IRS stating that her return is under review.
The woman said she went to a different tax preparer and was told her refund without the American Opportunity credit is below $4,000.
"Everything is fake," the woman said, referring to Prime Time's practices.
Ancaleto Mancillo is among those promised big refunds, but now fears receiving a temporary rejection letter from the Internal Revenue Service.
"My friends told me that they get you good money, but they don't know how they do it," Mancilla said. "They were recommended because they give a lot of money."
Even though he isn't paying any bills for college, Mancilla received $3,526 in college tax credits, inflating his return to $12,130. An independent preparer told the Call 6 Investigators that without the credit, Mancilla's refund would be about $8,000.
When the Call 6 Investigators visited Prime Time Tax Service, none of the employees wanted to take questions.
One person shouted through a closed door that returns were wrong because customers lied. A woman said the company was no longer in business, and a male employee threatened to call police.
Abuse of the American College Opportunity Tax Credit is costing taxpayers billions of dollars.
Prime Time Tax Service, at 5415 W. 34th St., offered "24-hour checks and the best refunds in the country."

Apparently abuse of the education tax credit is widespread, costing the U.S. Treasury billions of dollars annually in fraudulent claims.  Here's a press conference where Obama touts what a difference these tax credits are making according to a Treasury Department report. He was asking Congress to make the tax credit permanent and worth up to $10,000 for taxpayers taking advantage of it. More of that hope and change you were promised. Welcome to Obama Nation.



Wow, this reminds me of an operation working out of the back room of an ACORN office.

Indy4u2c said...

Yep, sounds just like something ACORN would sponsor. Now let's see if Democrat U. S. (softy) Attorney Joe Hogsett gets an indictment.