Don't fall victim to tax scams. These schemes take several shapes,
ranging from promises of large tax refunds to illegal ways of
"untaxing" yourself.
Beware of these common schemes:
Return Preparer Fraud:
Dishonest tax return preparers can cause many headaches for
taxpayers who fall victim to their ploys. Such preparers derive
financial gain by skimming a portion of their clients? refunds and
charging inflated fees for return preparation services. They attract
new clients by promising large refunds. Taxpayers should choose
carefully when hiring a tax preparer. As the saying goes, if it sounds
too good to be true, it probably is. No matter who prepares your tax
return you are ultimately responsible for its accuracy and for any tax
bill that may arise due to a questionable claim.
Identity Theft:
It pays to be choosy when it comes to disclosing personal
information. Identity thieves have used stolen personal data to access
financial accounts, run up charges on credit cards and apply for new
loans. The IRS is aware of several identity theft scams involving taxes
or scammers posing as the IRS itself. The IRS does not use e-mail to
contact taxpayers about issues related to their accounts. If you have
any doubt whether a contact from the IRS is authentic call
1-800-829-1040 to confirm it.
Frivolous Arguments:
Promoters have been known to make outlandish claims that the
Sixteenth Amendment concerning congressional power to establish and
collect income taxes was never ratified; that wages are not income;
that filing a return and paying taxes are merely voluntary; and that
being required to file Form 1040 violates the Fifth Amendment right
against self-incrimination or the Fourth Amendment right to privacy.
Don't believe these or other similar claims. Such arguments are false
and have been thrown out of court. Taxpayers have the right to contest
their tax liabilities in court but no one has the right to disobey the
law.
Three lessons to remember:
- You are responsible and liable for the content of your tax return.
- Anyone who promises you a bigger refund without knowing your tax situation could be misleading you, and
- Never sign a tax return without looking it over to make sure it is accurate.
For more information about these and other tax scams visit the IRS Web site at IRS.gov.
