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BURLINGTON, NC – A local tax preparer is headed to federal prison after admitting she cooked the books for her clients, raking in over $2.1 million in bogus refunds. Tracey Hernandez, 39, was sentenced to 25 months behind bars plus a year on supervised release this week, according to federal prosecutors.
Hernandez pled guilty last September to one count of aiding and assisting in the filing of false tax returns. Court documents reveal she operated as a “ghost preparer” – filing returns on behalf of clients without signing her own name, making it harder to trace the fraud.
IRS investigators say Hernandez filed over 200 fraudulent 1040 forms for 2021 and 2022. The scheme involved fabricated education expenses, phony refundable tax credits, and inflated business profits reported on Schedule Cs. She also falsely claimed sick and family leave credits for self-employed clients.
The judge ordered Hernandez to pay back the full $2,106,281 she illegally obtained. The IRS Criminal Investigation division handled the probe, with Assistant U.S. Attorney Ashley Waid leading the prosecution.