‘Motivated by greed.’ Kentucky couple helped people cheat on taxes using fake kids
A Kentucky husband and wife who helped people cheat on their taxes by claiming fake dependents have been sentenced to eight months in jail each.
Krlos Hidalgo, 40, and his wife Esther Baldeon, 41, also agreed to give the Internal Revenue Service $127,015 that federal agents seized from them during the investigation, according to a news release.
Baldeon had a business called E.K. Tax Service LLC in Louisville that prepared tax returns for people, according to court records.
Baldeon and Hidalgo offered clients the opportunity to reduce the amount of taxes they owed by adding dependents to their tax returns, according to their plea agreements.
If the clients took them up on the offer, the two added dependents that qualified the taxpayers for additional child tax credits, according to their court records.
People paid the business a fee ranging from $600 to $2,100 for each fake dependent, which was typically deducted from their refunds, Assistant U.S. Attorney Amanda E. Gregory said in a sentencing memorandum.
“The crime was motivated by greed — to obtain hefty fees for use of false dependents,” Gregory wrote.
The fake returns the two prepared caused a tax loss to the government totaling $526,682, according to the memo.
A court document says most of that went to clients, not Baldeon and Hidalgo, but documents in the case do not identify any taxpayers who took part in the scheme.
