North Carolina Man Sentenced to 36 Months in Federal Prison for Preparing False Tax Returns

Gene Hersholt Williamson II, was sentenced yesterday to 36 months in prison for aiding and assisting in the preparation of a false tax return and ordered to pay $637,000 in restitution, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.

According to court documents and statements made in court, Gene Hersholt Williamson II, 54, operated a tax return preparation business out of Jacksonville, North Carolina, between 2012 and 2018.  Williamson fraudulently inflated his clients’ claimed refunds by reporting fictitious Schedule C businesses on his clients’ returns.  If clients had minimal income, Williamson created a fraudulent Schedule C business for them, reporting additional income in order to maximize the claimed earned income tax credit.  If, however, clients had substantial wage income, Williamson created fraudulent businesses with significant expenses to reduce their income, qualifying them to receive the earned income tax credit.  Williamson received ten percent of the refunds for his services.  To conceal his involvement in the scheme, Williamson did not list himself as the paid return preparer on the returns he prepared.

In addition to preparing false tax returns for clients, Williamson filed false tax returns for himself from 2012 through 2017.  In all, Williamson’s misconduct resulted in a tax loss to the IRS of over $550,000.

U.S. Attorney Robert J. Higdon Jr. for the Eastern District of North Carolina and Principal Deputy Assistant Attorney General Zuckerman made the announcement after sentencing by U.S. District Judge James C. Dever III.  The IRS-Criminal Investigations investigated the case and Assistant U.S. Attorney Susan B. Menzer and Tax Division Trial Attorney William Guappone prosecuted the case.