Nicole Malliotakis

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Mr. Speaker, I rise today in strong support of my legislation, H.R. 9499, the Protecting Taxpayers from Ghost Preparers Act. This bill has received bipartisan support, and it passed unanimously out of our Ways and Means Committee. Every year, millions of Americans turn to tax professionals for help navigating our complicated tax code. They should be able to trust that the person they are paying to prepare their return is acting honestly and following the law. Unfortunately, dishonest tax preparers--often referred to as ghost preparers--take advantage of that trust. They alter returns, claim fraudulent deductions or credits, inflate refunds, and sometimes even take a percentage of the refund themselves. Then, they disappear and leave the taxpayer to deal with the IRS and the consequences. That is simply wrong. We have seen serious cases across the country. In Kentucky, two individuals pleaded guilty after preparing nearly 6,000 fraudulent Federal tax returns, resulting in more than $10 million in tax losses. In my home State of New York, a Long Island tax preparer pleaded guilty to nearly $12 million in a fraud scheme after preparing fraudulent returns and collecting more than $1 million in fees from his clients. In the Bronx, an individual was sentenced to 4 years in prison for orchestrating a decade-long tax fraud scheme involving tens of thousands of false returns. These schemes can leave innocent taxpayers holding the bag for misconduct they did not know about and did not participate in. Under current law, the IRS generally has 3 years to assess additional tax after a return is filed. When a return is fraudulent, that limitation can remain open indefinitely. The problem is that an innocent taxpayer could potentially face that unlimited period because of fraud committed by the preparer--even when the evidence is clear that the taxpayer had no intention whatsoever of evading taxes. My bill fixes that. H.R. 9499 makes clear that the unlimited statute of limitations for a fraudulent return applies when the taxpayer intended to evade taxes, not when a dishonest preparer acted alone without the taxpayer's knowledge. That is basic fairness. Taxpayers who knowingly commit fraud should absolutely face the consequences, and dishonest preparers who commit fraud should face the consequences, as well. I will continue working with my colleagues on both sides of the aisle on policies to ensure that fraudulent preparers and other bad actors are held accountable for taking advantage of hardworking taxpayers. Hardworking Americans should not face potentially endless tax liability because someone they trusted took advantage of them. Mr. Speaker, this is commonsense legislation, and it is a taxpayer protection measure. I thank Chairman Smith and the committee staff for their work to advance this legislation, and I urge my colleagues on both sides of the aisle to support it.