EMERYVILLE (CBS SF) – Federal law enforcement charged the head of a tax preparation business in Emeryville with tax fraud this week after she allegedly prepared dozens of fraudulent returns and taught his clients how to commit tax fraud.

On Wednesday, acting U.S. Attorney Stephanie Hinds, IRS officials and IRS Special Agent Mark Pearson announced that 44-year-old Traci Austin of Brentwood faces one count of aiding and assisting in the preparation of false and fraudulent federal income tax returns. Austin is the owner of Emeryville Tax Services.

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According to the complaint, Austin prepared at least 42 fraudulent returns, causing an estimated loss of more than $697,000 to the federal government. Prosecutors said the fraudulent returns would include false or inflated expenses on the Schedule A and Schedule C forms, along with false dependents.

“By doing this, Austin fraudulently reduced her clients’ taxable income and tax liability, thereby resulting in larger refunds for the client and higher return preparation fee income for Austin,” Hinds’ office said in a statement.

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The complaint also alleges that Austin has been hosting a so-called “Tax School” since 2016, where attendees paid at least $200 to learn how to prepare returns. Austin allegedly told attendees how to manipulate returns by listing fake businesses and fake expenses on tax forms.

Prosecutors said during one of the lessons, Austin described how she created a fictitious dog grooming business on a client’s return, created a fake profit and loss statement and even instructing a client to print out dog photos to support the claim of a business.

Austin made her initial court appearance Wednesday. If convicted, Austin faces a maximum of three years in federal prison and a $100,000 fine.

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Prosecutors said Austin remains out of custody and is next scheduled to appear in court on Feb. 24.