Sacramento Man Sentenced to 18 Months in Prison for Tax Refund Scheme

SACRAMENTO, Calif. — United States District Judge Kimberly J. Mueller sentenced Manuel Ruiz, 47, of Sacramento, to 18 months in prison for making false claims for tax refunds on federal income tax returns, United States Attorney Benjamin B. Wagner announced. Ruiz pleaded guilty on May 26, 2015.

According to court documents, Ruiz engaged in a scheme to fraudulently prepare tax returns for clients of a tax preparation business he operated from his home. As part of the scheme, Ruiz reported false wages and listed false dependents on his clients’ returns to qualify them for the Earned Income Credit (EIC) when they would not otherwise have been eligible, and to maximize the tax benefits of the EIC beyond the legitimate amounts to which his clients were actually qualified.

In total, between tax years 2009 and 2011, Ruiz made false claims on more than 180 returns, including returns that he filed on his own behalf and on behalf of others, which resulted in over $650,000 in fraudulent refunds paid out by the IRS. During that period, Ruiz directed more than $460,000 in tax refunds from the false claims into bank accounts he controlled. After payments to clients, Ruiz retained at least $192,000 from the false claims.

This case was the product of an investigation by the Internal Revenue Service, Criminal Investigation. Assistant United States Attorneys Sherry D. Hartel Haus and André M. Espinosa prosecuted the case.