The owners of a McDuffie County, Ga., tax preparation service have been sentenced to prison for filing dozens of fraudulent tax returns to obtain hundreds of thousands of dollars in excess IRS refunds for clients.
Annie Bailey, 67, of Thomson, was sentenced to 21 months in prison and her son Tremarcus Bailey, 43, also of Thomson, Ga., was to 30 months in prison after pleading guilty to Conspiracy to Defraud the United States, said Jill E. Steinberg, U.S. Attorney for the Southern District of Georgia. U.S. District Court Chief Judge J. Randal Hall also ordered the Baileys to pay restitution of $683,046 and to each serve three years of supervised release upon completion of their prison terms. There is no parole in the federal system.
“The Baileys’ business was a breeding ground for fraudulent activity, illegally enhancing their customers’ income tax refunds at the expense of the U.S. Treasury,” said U.S. Attorney Steinberg. “Thanks to the investigative work of our law enforcement partners, the Baileys are being held accountable for their criminal behavior.”
As described in court documents and testimony, including the Baileys’ guilty pleas, Annie Bailey owned Bailey’s Tax Service in Thomson, Ga., and her son Tremarcus was an employee. The company prepared income tax returns on behalf of customers since 2000. The business came to the attention of Internal Revenue Service Criminal Investigation in 2017, and a subsequent investigation determined the Baileys used fraudulent and fabricated information when filing tax returns for individual customers in order to illegally inflate the amount of refunds the clients would receive. The investigation determined that from 2014 to 2018, the fraudulent returns prepared by the Baileys resulted in $683,046 in criminal tax losses to the IRS.
“The sentencings of the Baileys should serve as a notice to dishonest tax preparers that their fraud will eventually be uncovered,” said Demetrius Hardeman, Acting Special Agent in Charge, Atlanta Field Office of IRS-Criminal Investigation. “We will continue to investigate and prosecute tax preparers who willfully include false items on tax returns, and this is a reminder to taxpayers to review their return with the preparer for accuracy.”
The case was investigated by Internal Revenue Service Criminal Investigation, and prosecuted for the United States by Southern District of Georgia Assistant U.S. Attorney Henry W. Syms Jr.
