Even among those who prepare false income tax returns, Ivan Backstrom is a standout.
This is the time of year when it is prudent to review the credentials and credibility of your tax preparer. The convenience of using someone recommended by a friend can be outweighed by the potential for future allegations of tax crime. It could also mean you have to pay back ill-gotten tax refunds. In short, tax preparation is a ripe field for tax fraud. That brings us to Mr. Backstrom.
A Milledgeville, Georgia resident, Mr. Backstrom developed and promoted a nationwide scheme to defraud the U.S. government and his clients along with it. He and his associates prepared and encouraged the filing of fraudulent tax returns between the years 2014 and 2016. Focused on a big payday, Mr. Backstrom and his crew traveled the country giving tax seminars and shilling their services.
The upshot of their scam was convincing taxpayers that their lending institutions withheld income tax on their mortgages and other debts. Because of the withholding, taxpayers were supposedly then due significant tax refunds when tax time rolled around. For a mere $10,000 to $15,000, Mr. Backstrom and his co-conspirators would prepare the false tax return, making sure the return was noted as “self-prepared,” to avoid detection. The bogus tax preparers prepared fraudulent financial documents to accompany the returns.
Overall, the fraudsters filed for over $25 million in refunds from the IRS. Personally, Mr. Backstrom earned about $1 million for his efforts. As you might guess, he failed to file his own tax returns during the years the scam was active.
The difficulty of criminal tax defense in this matter is the overt intentionality of the operation. Mr. Backstrom pled guilty in December 2021 to defrauding the U.S. He managed to pull in more than 200 clients from 19 states. He also pled guilty to preparing false tax returns.
With no set sentencing date at present, Mr. Backstrom faces roughly 30 or so years in prison, along with supervised release, restitution and penalties. In criminal tax matters like this, one has to ask, “was it worth it?” If you are currently engaged in questionable tax activities and your answer is “no,” now would be a good time to speak with a reputable criminal tax defense attorney.
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