Kingsport woman accused of preparing false income tax returns, obstructing IRS

Matthew Lane • Feb 14, 2008 at 12:00 AM

GREENEVILLE — A Kingsport woman, indicted last month on federal bank fraud charges, has been charged in federal court again — this time in connection to preparing false income tax returns and obstructing the Internal Revenue Service.

Earlier this week, a federal grand jury returned a 23-count indictment against Donna Blessing, 48, on charges of aiding and assisting the preparation of false income tax returns and corruptly obstructing and impeding the IRS.

Blessing entered a plea of not guilty to the indictment during an appearance in U.S. District Court in Greeneville on Thursday.

Blessing was released on bond to return for a final pretrial conference and motion hearing on March 17. A trial was set for April 16.

Blessing faces a maximum sentence of three years in prison and a $100,000 fine on the false tax return charges and a maximum sentence of three years in prison and a $250,000 fine on the obstructing charge.

The indictment alleges that Blessing, doing business as B&B Tax Service, aided and assisted in the preparation of at least 22 false and fraudulent individual income tax returns for the tax years 2003 and 2004. Blessing allegedly falsified itemized deductions, business expenses, and business profits and losses on returns that she prepared.

The amount of deductions falsely claimed by Blessing over the two-year period was more than $473,000.

Prosecutors say after Blessing’s clients were notified their returns were being audited, she directed her clients to create false documents to substantiate the fraudulent deductions, expenses and income on the returns.

Blessing is also charged with providing false and fraudulent documents to IRS employees during the civil audits.

“Unscrupulous return preparers cheat all honest taxpayers and tax advisers who play by the rules,” said James R. Dedrick, U.S. attorney for the Eastern District of Tennessee. “Shutting down fraudulent tax schemes is a high priority for the Justice Department and the IRS.”

This indictment marks the second time in just over a month Blessing has faced federal charges.

Last month a federal grand jury indicted Blessing on charges of scheming to defraud two local banks.

Prosecutors say Blessing made false statements about a manufactured home to Washington County Bank to get a loan and cashier’s check, and then forged an endorsement on the check to deposit it into a Bank of Tennessee account.

After making the deposit, Blessing began withdrawing funds from the account.

Trial on that indictment is scheduled for March 13.

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