The Internal Revenue Service (IRS) recently issued its annual list of tax scams, including those most common in places like Moore County.
“Be cautious! Remember a deal that sounds too good to be true probably is,” said IRS spokesman Dan Boone. “And when someone you don’t know and trust wants your private information, they may be up to no good.”
The following scams are the most common tax scams reported in Tennessee:
• Identity Theft may happen when someone tricks you into sharing your private information, or you may become a victim without knowing how your information was compromised. Anyone who believes his or her personal information has been stolen and used for federal tax purposes should immediately contact the IRS Identity Protection Specialized Unit. For more information, visit the special identity theft page at www.IRS.gov/identitytheft.
• Phishing is a scam typically carried out with the help of unsolicited email or a fake website that poses as a legitimate site to lure in potential victims and prompt them to provide valuable personal and financial information. It’s important to keep in mind the IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels.
• Return Preparer Fraud involves tax preparers who prey on unsuspecting taxpayers. Questionable return preparers have been known to skim off their clients’ refunds, charge inflated fees for return preparation services and attract new clients by promising guaranteed or inflated refunds. Taxpayers should choose carefully when hiring a tax preparer. In 2012, every paid preparer needs to have a Preparer Tax Identification Number (PTIN) and enter it on the returns he or she prepares.
• Promises of “Free Money” from the IRS and Tax Scams Involving Social Security may surface through flyers suggesting that you can file a tax return with little or no documentation or claim a tax credit for which you probably don’t qualify. These schemes often prey on low-income people or the elderly and may be spread by word of mouth as unsuspecting and well-intentioned people tell their friends and relatives.
• Frivolous Arguments promoters encourage taxpayers to make unreasonable and outlandish claims to avoid paying the taxes they owe. These arguments are false and have been thrown out of court. While taxpayers have the right to contest their tax liabilities in court, no one has the right to disobey the law.