The United States has asked a federal court in Detroit to bar two Michigan residents from preparing federal tax returns for others and also seeks to stop a Michigan attorney from promoting their alleged tax-fraud scheme. The action asks to stop Damian Jackson, a minister,  and his wife Holly Jackson, residents of Sterling Heights, Mich., from preparing returns. The other target of the alleged fraud scheme is Tammy Daniels, an attorney from Farmington Hills, Mich., an associate of the Jacksons. Their actions resulted in at least $1.6 million in refunds.

The complaint alleges that the Jackson and their business, Diamond & Associates Enterprises, along with Daniels, operate “Diamond Tax Services”, which promotes a scheme involving the preparation of fraudulent federal income tax returns for customers seeking large tax refunds based on a frivolous theory called “redemption” or “commercial redemption.” 

Jackson, a minister at the Perfecting Church in Detroit, prepares tax returns claiming huge refunds based on what the Justice Department says is fabricated income-tax withholding. Jackson reportedly became acquainted with a significant percentage of his customers through the church.

The complaint said that returns prepared by Diamond Tax Services sought more than $29 million in refunds for more than 180 customers with the Jacksons requesting more than $2.5 million in refunds on their personal returns. At least $1.6 million in refunds were paid by the IRS.