A Rock Springs accountant has been sentenced to four months in jail for filing fake tax returns on behalf of Sweetwater County restaurant owners with the Internal Revenue Service.
Paul Edman, 53, was sentenced on June 7 in U.S. District Court, and his jail time will be followed by one year of supervised release. He pleaded guilty in March to aiding and assisting in the preparation of false tax returns.
In February 2017, agents from the Internal Revenue Service, Homeland Security and the Wyoming Division of Criminal Investigations interviewed Edman about several of his clients, Sweetwater County restaurant owners who were believed to be hiding cas sales.
After a thorough investigation, including the use of a grand jury and interviews, the government determined Edman had willfully counseled the restaurant owners in the preparation of a false 1040 form for calendar year 2014, knowing that the form was false.
Edman made significant adjustments to both personal and business expenses related to the family-owned restaurants to reduce their tax bill, which totaled nearly $645,000.
In emails, he recommended ways they could deduct expenses in a fashion that would not stand out in an audit. This communication was easily traced and proved that Edman willfully provided the advice in an effort to defraud the United States government, the U.S. Attorney’s office said.
“All certified public accountants must be held to a higher standard when working with the taxpaying public in preparing income tax returns,” said IRS Special Agent in Charge Andy Tsui. “By disregarding this duty and preparing a client’s tax return knowing it contained false deductions, Paul Edman is now a convicted felon and will spend time in prison for his criminal actions.”
Ultimately, Edman reduced the amount of his client’s tax bill by $72,000, signed and filed the tax return electronically.
“Some may argue that tax evasion is a victimless crime, but that could not be further from the truth. We all end up paying when someone unlawfully evades our tax system,” said Acting U.S Attorney Bob Murray. “Edman’s aiding and assisting certain clients file false tax returns is an outright theft of the American taxpayer.”