Grand Rapids Mother and Son Jailed on Tax Charges

On December 1, 2009, in Grand Rapids, Mich., Joyce Stone and her son, Charles Freed, were each sentenced to 37 months imprisonment to be followed by two years of supervised release as the result of their June 2009 guilty pleas to conspiring to defraud the IRS.  The pair was also ordered not to prepare any tax returns for other individuals while under court supervision.   According to court records, during the mid 1990's through August 2006, Stone and Freed operated an income tax preparation service, known as Stone and Associates, from their home.  They prepared false and fraudulent income tax returns, where certain clients received a larger tax refund by significantly lowering the amount of taxable income, by falsely increasing or fraudulently creating itemized deductions reported by their clients, and claiming that ordinary daily activities were businesses that generated little income but incurred deductible expenses.  Both Stone and Freed reassured their clients that should there be an audit, they would have an ample supply of receipts they could use to substantiate their false deductions and expenses.