Former SK tax preparer pleads guilty to charges
June 12, 2008 · Updated 12:37 PM
A former Port Orchard tax preparer charged this year with helping clients claim fake dependents on their returns has pleaded guilty to at least five counts of defrauding the Internal Revenue Service, according to a plea agreement filed with the U.S. Attorneys Office in Seattle last week.
Richard A. Peirce was originally charged with 82 counts of fraud, which he allegedly performed over a five-year period while working as a tax preparer for Pats Accounting Inc. in Port Orchard.
According to the indictment, filed with the U.S. District Court office in Tacoma in April, Peirce devised a plan to defraud the Internal Revenue Service by helping clients receive the Earned Income Tax Credit (EITC) by claiming fake foster children as dependents.
According to court documents, for tax returns prepared between 1997 and 2003, Peirce used the names and Social Security numbers of his own children and those of other clients to willfully aid and assist clients in both receiving larger refunds from the IRS than they were entitled to, and in paying less income tax than was required.
As compensation, the indictment alleges, Peirce received a portion of the inflated refunds he facilitated for clients, which often amounted to several thousand dollars.
The indictment charged Peirce with 34 counts of aiding and assisting the preparation of false income tax returns, which include nearly 20 instances where a client received more than $3,000 of EITC when no amount was legally deserved.
The remaining counts alleged 48 instances of illegally using another persons identification specifically their names and Social Security numbers on tax returns between April 2000 and April 2003.
According to the plea agreement, Peirce admitted to three counts of filing false returns, all for the same client from the years 2001 to 2003. Over that three-year period, the client received more than $9,000 of the EITC.
Peirce also admitted to two instances of illegal use of Social Security numbers.
For each count of filing a false return, Peirce faces up to three years in prison. For each count of misuse of social security numbers, he faces up to 15 years in prison.
He is scheduled to be sentenced in January.
Acting on a tip by a former employee known as CW, IRS special agents raided Pats Accounting on April 15, 2003, and seized piles of documents and five computer hard drives.
Only four months earlier, Peirce had pleaded guilty in Kitsap County Superior Court to identity theft and forgery.