Two LBS tax offices searched in Hernando County - WFLA News Channel 8

Two LBS tax offices searched in Hernando County

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Investigators searched two LBS Tax Services offices in Hernando County on Monday, part of a fraud investigation.  The searches took place at the LBS offices in Brooksville and Spring Hill. Involved in the operation were the Hernando County Sheriff's Office, the Brooksville Police Department, the Internal Revenue Service and the Secret Service.

Deputies had seen the red-and-white signs advertising tax services along area roadways and heard some complaints, but it was a visit to the sheriff's office by a boyfriend and girlfriend a few weeks ago that spurred this investigation, said detective Bill Horvath of the sheriff's office.  The couple had gone to the LBS office in Brooksville and were concerned their refund was too high after talking to family members and an accountant.

"They thought they were going to be in trouble for … the way their taxes were filed," Horvath said. The couple hadn't initially been given copies of their tax return, but requested them from the office and shared them with the detective.  "The first thing I noticed was each of them had a business," he said. "I asked them if they actually had a business and they both said no."

Horvath said the companies were "fictitiously created." The strategy, he said, appears to be an effort to get taxpayers to qualify for the Earned Income Tax Credit – boosting both refunds and profits.  "LBS inflates their income to a level where they can get this credit and by doing so they have to fill out different IRS forms like the schedule ‘C' and they earned income tax forms," he said. "That's where LBS charges between $75 and $100 per form."

The door was locked at the Brooksville LBS office on Tuesday, and the person who answered the phone declined to comment.  Employees at the Spring Hill office directed questions to the owner, who said by phone that his lawyers were looking into the matter but that he didn't yet know what was going on.  Asked about the allegations that forms were filed for companies clients did not own, he said "we don't do such things."

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