Somewhere deep in the recesses of the Internal Revenue Service, someone--or some computer--must have looked at Rachel L. Breedlove's tax returns and said: Whoa!
Between December 1996 and June 1997, Breedlove, 30, is alleged to have filed 19 income tax returns, sometimes using the names of her deceased father and brother, or her three young children or phony names. Breedlove allegedly claimed in one 1996 return that her 4-year-old daughter earned nearly $9.5 million and was owed a refund of almost $1.2 million.
Breedlove collected refunds on two of her less sizable returns, totaling $126,614, according to a 19-count indictment handed up by a federal grand jury in Alexandria last week. But her other 17 alleged returns did not pass muster and instead led to her being charged with 19 felony counts of tax fraud.
Breedlove had lived in Woodbridge but is now in federal prison in West Virginia on unrelated charges out of the District, according to her lawyer, Joseph N. Bowman, who said he couldn't comment on the indictment.
Investigators in the current case said Breedlove filed some of her returns electronically and established phony bank accounts for her beneficiaries so electronic payments by the IRS could be deposited properly. Breedlove retained control of the bank accounts, the indictment said.
Some of the returns kept refund claims relatively small. Breedlove allegedly submitted one 1996 return for herself, on a paper Form 1040, claiming income of $73,941 and seeking a refund of $26,094. But two weeks earlier, she allegedly filed an electronic Form 1040 claiming income of $9.8 million for the same year, withholdings of $4.5 million and a refund of $721,727.
The indictment alleges that Breedlove filed five returns on behalf of her three children, who were 7, 6 and 4 at the time. Each time, the child's income allegedly was listed at close to $9.5 million.
Federal authorities declined to say how they detected the pattern of Breedlove's returns, saying they preferred to keep the IRS's methods secret.
In an unrelated case, Virginia officials said yesterday that a Culpeper County man filed a false state tax return and received a refund check for $2.9 million--even though his actual income was about $60,000.
Paul A. Nicholet, 60, a former Arlington resident, was arraigned on charges of filing a false return, and his bond was set at $1 million.