Date: February 27, 2023 Contact: newsroom@ci.irs.gov LOS ANGELES — A Riverside tax preparer pleaded guilty today to federal criminal charges for knowingly filing thousands of tax returns that falsely claimed deductions, such as fake medical expenses and bogus mortgage interest, and which caused more than $3 million in losses to the IRS. Andrew Zepada Hansack pleaded guilty to two counts of aiding and assisting in the preparation of a false tax return. According to his plea agreement, starting in January 2015, Hansack prepared personal income tax returns at AJ Loyal Income Tax Service, a Riverside-based company. Hansack filed tax returns for some of his clients that included false itemized deductions. Specifically, Hansack filed tax returns for these clients that indicated they had paid mortgage interest for their homes, when in truth, as Hansack knew, his clients did not own a home. Hansack also claimed false medical expenses, sales tax, and gifts by cash or check on some tax returns he prepared that he knew to be false. For the tax years 2015 through 2019, Hansack filed approximately 2,533 tax returns with false deductions on behalf of his clients. Because of Hansack's criminal activity, the IRS was prevented from assessing and collecting the correct amount of taxes owed by the clients. This resulted in a loss in assessed and collected taxes to the IRS between approximately $3,369,886 and approximately $3,799,378. For example, in February 2020, Hansack aided and assisted the preparation of a federal income tax return for a South Gate resident. This tax return falsely claimed $30,488 in itemized deductions, including deductions for mortgage interest. The false and fraudulent deductions caused the South Gate taxpayer to claim a refund from the IRS in the amount of $7,318 to which the taxpayer was not entitled. Hansack has agreed to pay a criminal fine of at least $50,000 and also agreed to a permanent ban on him helping to prepare tax returns for anyone other than himself or his spouse. United States District Judge Stephen V. Wilson scheduled a May 22 sentencing hearing, at which time Hansack will face a statutory maximum sentence of three years in federal prison for each count. IRS Criminal Investigation investigated this matter. Assistant United States Attorney Jeff Mitchell of the Major Frauds Section is prosecuting this case.
