Saturday, May 19, 2012
A Tax Crook Story
I have previously argued against draconian laws to protect against the morally unscrupulous. The key concept here is draconian: the little good the law does is far outweighed by its burden on society. Sometimes I believe that recent tax regulation is approaching this line.
And then I read about Todd Halpern, a tax preparer in New Jersey.
In 2008 Halpern purchased a tax preparation business from the widow of the prior owner. He received all the computers and client records in the purchase. Makes sense: the widow didn’t need them. The new practice required a new electronic filing number, but Halpern did not obtain one. He kept the previous owner’s number. Why? Because Halpern’s criminal record would keep him from getting a new number.
Then he prepares a tax return for the mom of a client. The problem is that the mom had no income. She collected social security and was claimed as a dependent on her son’s return. Halpern falsified her return, using fake income and deductions, to generate a refund. To complete the loop, he had the refund deposited to his account.
He kept doing this. After all, what could go wrong? The IRS estimates that he received approximately $375,000 in diverted refunds between July and August, 2009.
The guy is a crook. There exist enough laws to put him in jail.
Or maybe he can run for Congress.