Hartford Tax Preparer Pleads Guilty In Federal Court: Feds

HARTFORD, CT — A Hartford man whose job was to prepare taxes for clients pleaded guilty in federal court last week to tax fraud.

David X. Sullivan, U.S. attorney for Connecticut, and Harry Chavis, special agent in Charge of IRS Criminal Investigation in New England, said Clyde Gibson Jr., 43, of Hartford, waived his right to be indicted and pleaded guilty Friday in U.S. District Court in New Haven to a tax fraud offense.

According to court documents and statements made in court, from at least 2015 and continuing into 2024, Gibson operated as a tax return preparer under the name Build Understand Destroys LLC, and charged clients a fee for the preparation of tax returns.

Sullivan said Gibson prepared thousands of federal tax returns, many of which claimed false deductions.

For example, Sullivan said, in some returns Gibson prepared and filed for his clients, he included false Schedules C, which reported his clients operated sole proprietorship businesses and had incurred certain expenses and losses when, in fact, they had not operated such businesses and had not incurred the claimed expenses.

In some returns, Gibson included false Schedules D, which reported his clients had incurred capital losses, including carryover losses, or bad debts when, in fact, they had not incurred such capital losses and bad debts in the claimed amounts, Sullivan said.

During the investigation, Gibson met with an undercover federal agent posing as a customer.

The agent provided Gibson with a W-2 form for the 2021 tax year and offered no information about valid deductions for business losses, capital losses, and bad debt, officials said.

"Gibson initially prepared an appropriate return, on which the undercover agent would have owed taxes," wrote Sullivan in a release.

"Gibson then voluntarily opted to edit the return to reflect false and fraudulent information on the Schedules C and D."

During the 2016 through 2022 tax years, Gibson prepared at least 135 tax returns containing fraudulent information, causing a loss to the IRS of at least $125,197.

Gibson pleaded guilty to one count of aiding and assisting in the preparation of false and fraudulent income tax returns, an offense that carries a maximum term of imprisonment of three years.

He is released on a $25,000 bond pending sentencing, which is not scheduled.

Gibson has agreed to pay restitution of $125,197.

For more information on the case, click on this link.