Ethel Washington, Tax Fraud, Texas 2024

Shut Down: Tax Preparer Ethel Washington Busted for Tax Fraud in Dallas, Texas.

A federal court in Texas has shut down two Dallas tax preparers, Ethel Washington and her former employer Tina Preston, during the height of tax-filing season. The court found that Ethel Washington repeatedly prepared federal tax returns with false or inflated Schedule C business losses, even after the Internal Revenue Service (IRS) notified her that it was investigating her return preparation. This is not the first time Washington has been involved in tax fraud, with the court noting that she has prepared returns with false or inflated business losses since 2004.

According to the government complaint, Tina Preston allegedly taught employees, including Ethel Washington, how to list phony businesses on customers’ returns in order to report false business losses to offset customers’ wage income. The complaint further alleged that the defendants sometimes used phony businesses to increase customers’ income in order to claim improper earned income tax credits, a benefit that is available under some circumstances to working people in certain income ranges. The tax losses from the defendants’ misconduct could be as much as $60 million.

The court has permanently barred Tina Preston and her firm, The Preston Group & Associates Inc., from preparing federal tax returns. Preston consented to the civil injunction order and was required to provide her customer list to the Justice Department and to post a copy of the court order on her website.

Tax preparers who engage in fraudulent activities can face serious consequences, including being shut down and charged with crimes. The Justice Department has obtained injunctions against more than 380 tax preparers and tax-fraud promoters in the past decade.

Defendant: Ethel Washington, Washington Income Tax Service

Criminal Charges: Preparing federal tax returns with false or inflated Schedule C business losses

City and State: Dallas, Texas

Outcome: Temporarily restrained from preparing any tax returns

Dollar Amount Not Specified

Date: Not Specified

Source: https://www.justice.gov/archives/opa/pr/federal-judge-shuts-down-two-dallas-tax-preparers