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A tax preparer was arrested, released while her

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federal case was pending, and told not to

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commit another crime.

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Then, according to the government's account, she prepared

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another false return.

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This time, it included a business the client

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did not operate.

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That is the turning point in the case

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of Carlotta Elaine Lampley, a tax preparer in

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Dothan, Alabama.

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In September 2026, she was sentenced to 57

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months in federal prison.

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This is Tax Crime Stories from the Tax

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Cuttery.

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We follow the documents, the money, and the

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tax issue at the center of the case.

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The account in this episode comes from the

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IRS criminal investigation announcement dated September 11, 2026.

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It describes court documents, admissions, and the sentencing.

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We are explaining that published account.

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We have not interviewed the people involved, and

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we will not invent conversations or motives to

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fill the gaps.

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Start with an ordinary situation.

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A person takes their tax information to a

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preparer.

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They want an accurate return and an answer

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about what they owe or what they will

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receive.

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They may focus on the final number.

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But the final number is the result of

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everything entered above it.

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That is why the details in this case

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matter.

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The problem was not simply that a refund

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looked attractive.

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The government described false information in returns prepared

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for Lampley and for clients.

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According to the release, Lampley began preparing returns

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for clients in 2015.

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The investigation described false returns for tax years,

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2020 through 2025.

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Those are tax years, not necessarily the dates

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each return was submitted.

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Her business commonly collected preparation fees from clients'

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refunds before passing along the remaining money.

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Keep that fact separate from the criminal conduct.

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The release describes it as part of how

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the business operated.

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It does not establish that every arrangement collecting

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a fee from a refund is fraudulent.

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The relevant question was what income she actually

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earned and what information appeared on the returns.

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The release describes an admission involving her own

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2023 return, prepared in 2024.

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She reported income of $52,343.

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She admitted that the figure was false because

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it omitted fees she earned, preparing clients' returns

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and retained from their refunds.

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Pause on that distinction.

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A fee can be earned even when it

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does not arrive as a separate check handed

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across a desk.

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In this case, the admission concerned fees retained

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from refunds.

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Following that flow of money helps explain why

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investigators looked beyond the income figure printed on

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the return.

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Our diagram is a simplified illustration of the

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arrangement described in the release.

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It is not a bank statement from the

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case.

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The labels separate the client's refund, the preparer's

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retained fee, and the remainder transferred to the

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client.

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The tax issue described by the government concerns

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the preparer's omitted fee income.

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The case then reached a point that might

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have ended the conduct.

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A federal grand jury indicted Lampley and she

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was arrested on September 24, 2025.

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The release says her pretrial conditions prohibited new

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violations of law.

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An indictment by itself is an allegation.

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That is important when reading any crime story.

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Here, however, the release goes on to describe

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admissions and a later sentence.

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We can explain the outcome while still keeping

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the stages of the case in their proper

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order.

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The next date is January 22, 2026.

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According to the announcement, Lampley prepared a client's

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return that claimed the client operated a business

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and earned a profit.

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The client did not operate that business and

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had never told Lampley that the business existed.

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The return also included other earned income the

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client had not received.

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This is the detail that makes the story

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more than another headline about a tax preparer.

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The false information involved income being added, including

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income from a non-existent business.

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Tax fraud does not always look like someone

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simply erasing income from a form.

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But we need to stop where the source

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stops.

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The release says the false information was material

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and intended to affect the client's tax liability

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in a way that benefited the client at

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the government's expense.

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It does not identify the exact credit calculation

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for that particular return.

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We will not invent one.

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On screen, the two-column comparison is a

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teaching graphic.

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One side says what the government reported the

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return claimed.

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The other says what the government reported about

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the client's actual circumstances.

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These are labels summarizing the announcement, not a

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recreation of the client's private return.

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The announcement says Lampley admitted knowing that the

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statements were false.

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It also says the new conduct violated her

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release conditions and resulted in a superseding indictment

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with additional criminal conduct.

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Now look at the timeline as a whole.

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The business began in 2015.

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The release identifies the tax years involved in

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the investigation.

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The arrest came in September 2025.

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The additional false return came in January 2026.

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Sentencing followed in September.

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That sequences the story.

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We do not need a fictional scene of

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investigators breaking down a door.

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We do not need to guess what anyone

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was thinking.

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The dates and admitted conduct already explain why

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this case stands out.

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At the September 10th sentencing, the court imposed

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57 months in prison, followed by three years

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of supervised release.

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The release also reports a restitution order of

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$314,247.

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There is another amount in the announcement, estimated

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actual losses exceeding $2.1 million across the

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full period of the scheme.

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Those amounts describe different things.

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The larger figure is the estimated overall loss

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identified in the announcement.

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The smaller figure is the restitution ordered at

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sentencing.

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We should not swap one for the other.

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And this source does not explain every reason

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the figures differ.

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What can an ordinary viewer take from this

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case?

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Ask about the information behind the result.

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If a return describes a business you never

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operated or income you do not recognize, that

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is a specific question to raise before proceeding.

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A larger refund does not explain whether the

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entries supporting it are accurate.

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That observation does not mean every mistake is

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a crime or every preparer is suspect.

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This episode concerns a particular federal case with

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admissions and a sentence.

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Your own tax situation needs its own facts.

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The IRS's guidance on choosing a tax professional

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encourages taxpayers to review their return, ask questions,

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and understand it before signing.

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That is a useful habit whether a refund

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is large, small, or nonexistent.

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For a broader explanation of how the IRS

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works, see Chapter 17 in the Tax Cuttery

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Guide to Federal Income Taxation.

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The book link is below.

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If you need help with your own tax

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situation, use the separate tax consultation link.

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Subscribe for tax stories grounded in the documents.

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Next, our CP2000 Explainer shows how to approach

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an IRS notice when information does not match

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your return.

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A notice is not this criminal case, and

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knowing the difference is a good place to

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start.