$20 million questions; speared; tag, you’re it; and other highlights of recent tax cases.

Miami: Beatriz Toledo, 61, owner of a tax prep business who pleaded guilty in December to aiding and assisting the preparation of false returns, has been sentenced to almost five years in prison and a year of supervised release.

Toledo owned Immigration and Tax Service Group and for tax years 2017 through 2021 prepared false and fraudulent returns for clients. The returns included false claims for the Residential Energy Credit, false itemized deductions for state and local sales taxes, and false business expenses. She submitted some 7,800 returns with fraudulent claims for energy credits, resulting in her clients’ underpayment of about $20 million in federal taxes. Her practice received some $7.1 million in prep fees that it took out of clients’ refunds.

She did this in violation of a permanent injunction entered against her in 2010. In that civil case, the U.S. sued to bar Toledo from preparing returns; Toledo agreed to an injunction, which the court entered in 2020. She continued to prepare false returns and was indicted last year.

Toledo was also ordered to pay more than $20 million in restitution to the IRS.

Owings Mills, Maryland: Resident Maureen Wilson has been convicted for conspiracy to commit insurance fraud and for related charges for wire fraud, money laundering and filing false tax returns.

She was convicted of one count of conspiracy to commit mail and wire fraud, four counts of mail fraud, two counts of wire fraud, one count of conspiracy to commit money laundering, one count of money laundering and two counts of filing a false return. She was acquitted of one count of mail fraud.

She conspired with her husband to defraud insurance companies by obtaining more than 40 life insurance policies by misrepresenting applicants’ health, wealth and life insurance coverage. The total death benefits from these policies exceeded $20 million. Wilson also conspired to defraud individual investors to obtain funds that she used to pay premiums. The couple transferred the money from the fraud through multiple bank accounts, including those in the name of trusts.

Wilson filed false individual income tax returns for 2018 and 2019 that did not report as income some $9.7 million from her fraud.

Sentencing is June 20. She faces up to 20 years in prison for each count of conspiracy, wire fraud, mail fraud and money laundering and up to three years in prison for each count of filing a false return. 

Providence, Rhode Island: Businesswoman Gail M. Hynson, who collected but failed to pay over to the government eight years’ employee federal withholding taxes and properly report her income to the IRS, has been sentenced to two years of probation.

President of Hynson Electrical Services, she pleaded guilty in October to 10 counts of failure to account for and pay over payroll taxes and three counts of filing a false return.

From 2016 through 2024, Hynson, who also acted as the company bookkeeper, withheld employment taxes from employees’ paychecks but failed to provide the funds to the IRS. Much of the money was transferred to her bank accounts and used to pay personal expenses, including her mortgage, car payments and her daughter’s student loans.

Hynson and her husband also submitted personal federal returns that failed to reflect their income, which included company withholdings earmarked for the IRS.

Hynson failed to remit a total of some $1.22 million to the IRS.

She was also ordered to perform 100 hours of community service.

Phoenix: Jackie Marie Peters, 53, of Mansfield, Texas, has been sentenced to 18 months in prison, to be followed by three years of supervised release, after pleading guilty in connection with hacking a tax preparer’s computer system.

From around January 2020 through April 2022, her co-conspirators hacked into an Arizona tax prep firm’s computer network and modified in-progress tax documents for more than 40 individuals without their knowledge or the knowledge of the firm. Peters then opened 10 bank accounts at different banks where numerous refunds based on the modified tax documents were deposited.

Peters transferred more than $2.5 million from the accounts to buy cryptocurrency.

Rogers Park, Illinois: Tax preparer and tax prep business owner Farooq Khan, 31, has pleaded guilty to stealing more than $3.6 million from federal pandemic relief loan programs, according to news reports.

Khan reportedly faces up to four to five years in prison for defrauding the Paycheck Protection Program and Economic Injury Disaster Loan program. News outlets said he admitted to submitting false applications for himself and others who paid him kickbacks of up to 20%. He pocketed more than $1 million in fraudulent loans, prosecutors told news outlets, and arranged about $2.6 million in loans for people who applied using fake or insolvent companies.

Khan said he would pay the government $1.2 million, along with $629,000 the government seized from his bank accounts, reports said.

Great Falls, Virginia: Businessman Rick Tariq Rahim has been sentenced to 78 months in prison for tax crimes and wire fraud.

Rahim owned and operated several businesses, including laser tag facilities and an Amazon reseller. From 2015 to 2021, he did not pay the IRS the taxes withheld from his employees’ paychecks or file the required quarterly employment returns.

Between October 2010 and October 2012, Rahim filed two personal income tax returns on which he reported owing substantial taxes but did not pay all the taxes due. When the IRS attempted to collect, he submitted a false statement that omitted valuable assets he owned, including a helicopter, a Bentley, a Lamborghini and real estate. Some two weeks later, Rahim transferred ownership of the property to his wife.

He paid personal expenses from his business bank accounts, including more than $889,000 toward his mortgages and more than $669,000 to purchase or lease cars; he also withdrew more than $1.1 million in cash in amounts less than $10,000.

Rahim has not filed a personal income tax return since 2012 despite earning more than $34 million. In total, he caused a loss to the IRS of at least $4.4 million.

He also agreed to forfeit over $1.3 million, and must pay restitution to the IRS and to his fraud victims.

Belle Chasse, Louisiana: Bookkeeper Mary B. Katicich, of Marrero, Louisiana, has been sentenced to a year and a day in prison and three years of supervised release for wire fraud and for making and subscribing a false return.

She used her position as bookkeeper for a local company to steal money from its bank accounts. She also filed a return for 2016 that failed to report some $120,190.58 of income.

Katicich, who pleaded guilty last year, was also ordered to pay $439,650.51 in restitution to the owner of the company and $28,612.45 to the IRS. She must also pay a special assessment of $100.