A Milwaukee man pleaded guilty to four charges filed against him after he helped hundreds of clients prepare false tax returns in an effort to boost the amount of money they would get in return.
Rodney Smith, age 60, filed 1,338 tax returns between 2018 and 2021, according to court documents.
During that time period, Smith claimed to be a tax preparer and ran his own business called Xpert Tax Services located at 1332 S. 6th St.
“A conservative estimate of the tax loss associated with the 1,338 returns that Smith prepared in the relevant timeframe—which excludes any return with Schedule C income—is $3,365,948.32,” according to court documents in the case.
Smith was accused of “willfully assisting” clients in preparing fraudulent tax returns that maximized the refunds they received. He prepared fraudulent tax returns for his clients by providing false information about the clients’ dependents, wages, and income or losses from household help. This led to clients qualifying for refundable credits they were not supposed to receive.
In March 2020, an undercover operation was conducted by a federal agent who contacted Smith to set up a meeting. The agent told Smith she was hoping to have her 2019 federal income tax return prepared. She told Smith she needed to file as a single person, with no children or home.
Smith later asked the agent if she had any nieces or nephews that would allow her to list them on her tax return.
He allegedly told the agent, “Because with this, with one kid, I could probably get you like five thousand or something.”
Smith then filed the agent’s tax return using the name, birth date and social security number of a child whose parent is friends with the agent.
In November 2020, investigators executed a search warrant at Smith’s business. He allegedly admitted that 60% to 70% of the income tax returns he prepared were false. Despite being contacted by special agents in 2020, Smith continued to file false returns in 2021.
Smith was charged with four counts of aiding in the preparation of false tax returns and plead guilty to all charges filed against him. Each count carries with it the possibility of up to three years in prison and a $100,000 fine. Smith must also pay restitution in the amount of $216,643.
