Encino Tax Prep Company Owner Pleads Guilty to Helping Client File a False Tax Return and Admits Causing Tax Loss of More Than $400,000

LOS ANGELES – The owner of an Encino tax preparation company pleaded guilty today to helping a client file a false individual tax return that deliberately underreported the client’s income, admitting that this and other false tax returns for the same the client caused a loss to the IRS of more than $400,000.

Bijan Kohanzad, 62, of Calabasas, pleaded guilty to one count of aiding and assisting the filing of a false tax return.

According to his plea agreement, beginning in mid-2015 and lasting until May 2017, Kohanzad helped and counseled a client to reduce the client’s taxable income. He did so illegally by falsely increasing the client’s business expenses reported on the client’s federal tax returns.

On the client’s corporate tax return for the year 2015, the client’s company claimed $150,000 in advertising expenses, a claim that Kohanzad knew was false. This false expense claim reduced the company’s ordinary business income from more than $326,000 to over $176,000, and fraudulently reduced the income the client would then report on his individual tax return. 

In September 2016, Kohanzad also knowingly and willfully helped and advised the same client to file a false individual income tax return for the year 2015. On this return, the client failed to report the approximately $150,000 in concealed income that the client had received through his company. As a result, the client’s personal tax return falsely reported a taxable income of $127,878, when the actual amount exceeded $278,000.

For the tax year 2016, Kohanzad admitted that he again prepared and filed corporate and individual income tax returns for the same client that he knew were false. As with the false 2015 tax returns, the 2016 corporate tax return falsely claimed $886,325 in business expenses, which reduced the company’s reported ordinary business income, and fraudulently reduced the client’s taxable income as reported on his individual tax return from more than $1.3 million to less than $450,000.

The total loss Kohanzad caused to the IRS for these two tax years was approximately $401,436. Kohanzad admitted in his plea agreement that he acted willfully and that he voluntarily and intentionally violated federal law. 

United States District Judge André Birotte Jr. scheduled a July 12 sentencing hearing, at which time Kohanzad will face a statutory maximum sentence of three years in federal prison. Kohanzad is free on $100,000 bond.

IRS Criminal Investigation is investigating this matter.

Assistant United States Attorney Monica E. Tait of the Major Frauds Section is prosecuting this case.