US Government Sues Jackson Hewitt

According to the IRS’s website, the United States government has filed civil injunction suits against five corporations that operate Jackson Hewitt tax preparation franchises as well as 24 individuals managing or working at the franchises. The suit claims that the franchises "created and fostered a business environment" at the Jackson Hewitt franchises "in which fraudulent tax return preparation is encouraged and flourishes." Some examples of the fraudulent preparation include phony W-2 forms, fabricated businesses and business, massive fraud involving the Earning Income Tax Credit, etc. The suits also allege that Jackson Hewitt franchise managers and employees got kickbacks from customers to file fraudulent tax returns.
The suit is seeking more than $70 million in losses to the U.S. Treasury Department, as well as seeking court orders barring the franchisees and other defendants from preparing tax returns for others. "When practitioners prepare a false tax return, it has a corrosive impact on the tax system," claims IRS Commissioner Mark W. Everson. "I am deeply disturbed by the allegation that a major franchisee of the nation’s second-largest tax preparation firm is intentionally preparing improper tax returns with inflated refunds. I’m particularly concerned that many taxpayers of modest means could actually end up owing the government thousands of dollars if they claimed an improper refund."