Kathy R. Moton, Tax Return Preparer Fraud, Mississippi 2020

Tax Return Preparer Accused of Filing False Returns in Mississippi

A shocking case of tax return preparer fraud has come to light in Senatobia, Mississippi, where Kathy R. Moton, owner of K&M Tax Essentials LLC, is accused of filing hundreds of false tax returns between 2018 and 2020. The scheme allegedly involved claiming false American Opportunity Tax Credits, which provide a tax credit for tuition and expenses for an undergraduate or other recognized education credential.

According to the complaint filed in the U.S. District Court for the Northern District of Mississippi, Moton and K&M Tax Essentials LLC prepared and filed returns that claimed false American Opportunity Tax Credits, resulting in a loss to the IRS of over $1 million. The defendants allegedly concealed the fraudulent claims from their customers by omitting forms from the copies of returns provided to those customers.

Acting Assistant Attorney General David A. Hubbert of the Tax Division made the announcement. Return preparer fraud is one of the IRS' Dirty Dozen Tax Scams, and taxpayers seeking a return preparer should remain vigilant.

Kathy R. Moton, 60, and her company K&M Tax Essentials LLC, are accused of preparing and filing hundreds of false tax returns between 2018 and 2020. The exact date of the crime is not specified, but the complaint was filed in 2020.

The defendants' practices resulted in a loss to the IRS of over $1 million. As of now, the status of the case is pending. If convicted, Moton and K&M Tax Essentials LLC could face severe penalties, including fines and imprisonment.

Taxpayers seeking a return preparer should be cautious and do their research. The IRS offers information on its website for choosing a tax preparer, and there is a free directory of federal tax preparers. Additionally, the IRS has a list of important reminders for taxpayers who are about to file their 2020 tax returns.

Information about this case and other similar cases can be found on the Tax Division's website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes is also available on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

Source: https://www.justice.gov/archives/opa/pr/justice-department-files-civil-action-shut-down-mississippi-tax-return-preparer