By Karen O'Shea
Staten Island Advance (New York)
Copyright 2007 Advance Publications, Inc.
All Rights Reserved
STATEN ISLAND, N.Y. — He used to be a firefighter.
Now he's an accountant with the tax man on his tail.
Thomas Keeley is trying to extinguish a legal brushfire - it's alleged he prepared fraudulent tax returns for clients and failed to report nearly $1.3 million of his own income.
Keeley, a resident of the Richmond section, is suspected of getting $26,896 in fraudulent refunds for 10 clients in 2000 by claiming they were entitled to particular itemized deductions based on "fictitious or inflated job expenses, charitable contributions or medical expenses," according to an indictment.
But authorities are more concerned with charges that Keeley failed to report nearly $1.3 million in income on his tax returns.
More people who used the accountant, a retired firefighter known to do a lot of tax work for other firefighters, could be audited as the IRS continues to review the taxes he prepared over the last seven years.
"The investigation is ongoing," an IRS spokesman said yesterday.
Keeley was released on $50,000 bail after pleading not guilty during his arraignment yesterday in Brooklyn federal court.
Keeley, who runs his accounting office out of a house at 358 Clarke Ave., allegedly failed to report $1.3 million of his own taxable income from 2000 to 2002. In 2002, he reported $28,760 in income but failed to report another $640,615 in taxable income, according to court papers.
An IRS source said authorities are also investigating whether Keeley owned any income-generating properties.
Irving Seidman, Keeley's attorney, declined to comment yesterday; Keeley did not return a phone call seeking comment.
Investigators said the 10 clients whose questionable refunds are included in the current charges will have to refile correct returns and pay interest. Some could be hit with penalties, although an IRS spokesman said each case will be considered individually. The clients were not named in court papers.
"Taxpayers should be very careful when choosing a return preparer. While most preparers provide excellent service to their clients, a few unscrupulous return preparers file false tax returns and defraud their clients. It is important to know that even if someone else prepares your return, you are ultimately responsible for all the information on the tax return," said Gerard Sullivan, a spokesman with the New York criminal investigation field office of the IRS.
The tax evasion charges carry penalties of up to five years in prison and $250,000 in fines. Charges of aiding and assisting in the preparation of false returns carry penalties of up to $100,000 and three years in prison. Keeley is due back in court next month.
