IRS Help

The IRS has been slowly releasing its list of “Dirty Dozen” tax scams since the beginning of 2015. In February, it finally announced the entirety of its list.:

Identity Theft – Scammers try to get personal information anyway they can. Some criminals will file fraudulent returns using someone else’s Social Security Number.

Inflated Refund Claims – Taxpayers need to be aware of people offering what seems like an inflated refund. People need to be wary of anyone promising a big refund before looking at their records, asking them to sign a blank return, or charging fees based on a percentage of the refund.

Phishing Scams – Some scammers will try to get private information by sending taxpayers fake emails. The real IRS won’t send emails about bills or refunds.

Phone Scams – This has long been a common way for scam artists to steal money from unsuspecting taxpayers. Someone impersonating an IRS agent will call a taxpayer and make aggressive threats, including police action, and deportation among other things. The real IRS will mail a notice first before calling.

Return Preparer Fraud - Taxpayers should be aware of dishonest preparers. Not many, but a few will try to commit identity theft, refund fraud, and other scams to hurt taxpayers.

Offshore Tax Avoidance – The recent string of successful enforcement actions against offshore cheats and the financial organizations that help them shows that it’s a bad idea to hide money and income offshore.

Fake Charities – Unfortunately, there are groups who try to pose as charities. Taxpayers should research any “organization” before making a donation. Some of these charities will use names that sound similar to well-known national organizations.

Hiding Income with Fake Documents – Filing a false Form 1099 (or falsifying any document) is something taxpayers should be aware of. If a tax preparer suggests falsifying ANY document, they should not be trusted.

Excessive Claims to Fuel Tax Credits – Avoid incorrect claims for fuel tax credits. Generally, the fuel tax is used for off-highway business use like farming. The credit isn’t available to most taxpayers. A lot people get enticed by scammers to claim it.

Abusive Tax Shelters – Avoid using abusive tax structures to avoid paying taxes. Be sure to do some research and find an independent opinion about complex products.

Frivolous Tax Arguments – Some scammers will try to entice people to make absurd claims to not pay the taxes they owe.

Falsifying Income to Claim Credits – Some scammers will talk taxpayers into “inventing” or falsifying income to claim tax credits. Taxpayers are legally responsible for what is on their return. Filling out the most accurate return is what is best for the taxpayer.

 

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