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South Carolina Preparers Draw Ban

Justice logoTwo South Carolina women have been banned from preparing federal tax returns for others. The Justice Department obtained an injunction that permanently bars Rachel D. Watson, of Florence, and Susan Allen of Darlington, S.C., as preparers. The two were also required to send copies of the injunction to any employers for whom they prepared returns since Jan. 1, 2008.


The companies operated by Watson and Allen included Fludd's Express Tax Service and Gold Valley Pawn. The two were accused of making unwarranted use of the Earned Income Tax Credit by reporting phony Schedule C businesses, business income and non-existent dependents or dependents who did not live with the taxpayers and also of fabricating and inflating deductions.

In its original complaint, the government said all 32 returns prepared by Watson and six prepared by Allen that were examined had problems. Based on these examinations, the IRS estimated that the taxes lost via Watson's work could reach $5 million while the over-inflated refunds claimed on returns prepared by Allen might reach $3.5 million.

The two were also accused of systematically not signing returns. Allen was cited for using the identification numbers of other preparers, including Watson and of a former employer.
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