Daria Emma Valdivia, Tax Return Preparer Fraud, Illinois 2023

STERLING, Illinois – In a major blow to tax return preparer fraud, a federal court in Illinois has permanently shut down Daria Emma Valdivia, individually and doing business under the name Emma’s Agency, from preparing federal tax returns for others.

Valdivia, of Sterling, Illinois, allegedly routinely prepared federal tax returns from her business Emma’s agency for customers that falsely claimed unqualified individuals as dependents, such as persons who did not live in the United States or a country contiguous to the United States.

The government complaint alleges that Valdivia also improperly reported her customers’ filing status as Head of Household when the customers were ineligible for that status. This return preparer misconduct allowed Valdivia to understate her customers’ tax liabilities and claim undeserved refunds for them.

According to the government’s complaint, Valdivia continued to engage in this conduct despite the fact the Internal Revenue Service (IRS) assessed her with $132,000 in penalties for similar violations of the Internal Revenue Code. The complaint alleges that IRS audits of 65 returns prepared by Valdivia show that she underreported her customers’ tax liabilities on 89 percent (58) of them by more than $285,000, collectively.

The IRS is reminding taxpayers that the 2017 individual income tax return filing season begins Jan. 23, 2017, and there is information available on the IRS’s website. Return preparer fraud was one of the IRS’s Dirty Dozen Tax Scams for 2016, and taxpayers seeking a return preparer should remain vigilant.

The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website.

If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

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