Federal judge sentences Md. tax preparer to prison for filing false returns

A federal judge sentenced a Maryland tax preparer to two years in federal prison for preparing false tax returns.

United States District Judge Theodore D. Chuang sentenced Ronald Eugene Watson, also known as Sabir Muhammad, on Tuesday to two years and three months in federal prison followed by one year of supervised release for 23 counts of aiding and assisting in the preparation of false tax returns.

From at least 2015 to 2017, Watson prepared and filed fraudulent tax forms for clients, including Form 1040 and related Schedules A and C, obtaining from the IRS tax refunds for his clients that were greater in amount than to what they were entitled, according to the indictment. Watson included inflated and fictitious tax deductions and fraudulent business profits and losses to help secure larger tax refunds for his clients.

The tax loss to the U.S. totaled $325,330, according to the Maryland U.S. Attorney’s Office.

“Those who prepare and file fraudulent returns cheat all honest taxpayers. We hope this sentence sends a message to deter others from stealing taxpayer funds,” said Erek L. Barron, U.S. attorney for the District of Maryland.

Watson worked as a self-employed tax return preparer operating SW Accounting Associates in Largo, according to the Maryland U.S. Attorney’s Office.

According to witness testimony presented at trial, Watson varied his preparation fees depending on the amount of the refund requested, with fees typically ranging from approximately $500 up to $1,500.

A jury convicted Watson in March after an eight-day trial.

In addition to the false filings, Watson failed to file his own tax returns for two years and filed false tax returns in three other years, according to the Maryland U.S. Attorney’s Office.

Judge Chuang ordered Watson to pay $268,634.35 in restitution.

Assistant U.S. Attorney Leah B. Grossi and trial attorney Matthew L. Cofer of the Justice Department’s Tax Division prosecuted the case.

Counsel for Watson declined to comment.