Be Careful Who You Choose to Do Your Taxes
Tax fraud and identity theft has been rampant in the U.S. during the last few years. With sophisticated cyber thieves you never know where you’re likely to be a target. One thing you can control is the person or firm you select to do your taxes. Whether it is an independent tax preparer or a well-known company, do your due diligence to find out if they have been involved in any tax fraud schemes. You’d be surprised how many tax preparers around the country have been arrested and convicted of various forms of tax fraud and identity theft.
I offer a few cases of tax preparer fraud without naming names, to give you an example of the types of situations that you could run into when seeking a reputable tax preparer. If the preparer promises you fantastic returns and asks you to make dishonest claims, that’s the first red flag and you really should run.
These examples are from Accounting Today, a reputable source for industry news and information.
This first example states that, “In Aberdeen, Md, the U.S. has filed to permanently bar a tax preparer and her business from preparing federal returns and promoting a frivolous tax avoidance scheme. According to the complaint, the preparer and her business prepared income tax returns for customers that fraudulently overstate the refunds due by claiming false withholdings or credits. The complaint alleges that the preparer also promotes a tax-avoidance scheme based upon the bogus “redemption” theory, in which individuals assert that the federal government maintains secret accounts for U.S. citizens that can be accessed by issuing various forms to the IRS.
According to the complaint, Johnson prepares fraudulent 1099-As and 8281s for clients to claim enormous refunds on their behalf – totaling, claims the government, millions of dollars in bogus refunds.
In Roselawn, Ohio a tax preparer has reportedly admitted to participating in a refund scheme that officials said involved between $400,000 and $1 million.
According to news outlets, this person prepared some 300 income tax returns for 2010 and 2011 that officials said involved the submission of false claims for refunds. The business has since closed, reports added. This tax preparer faces up to five years in prison, though according to the article, a sentencing date has not been set, reports added.
And finally this example from Mount Ephraim, N.J. where a tax preparer has been charged with three counts of forgery and one count of theft for allegedly stealing thousands of dollars from a client. According to the article the tax preparer allegedly forged the victim’s signature on three years’ refund checks totaling $9,467 and deposited the money into the preparer’s own account in June 2013.This tax preparer was indicted on all four counts by a grand jury in September.
As you can see, tax fraud and identity theft is not limited to stealthy Internet thieves or phone scammers. They can be a little pop-up shop around the corner, maybe even someone you’ve known for years. The best solution is to seek a tax preparer with an exemplary track record and indisputable credentials. Tax season is stressful enough. If you don’t want any more stress in your life and you need a tax preparer, simply call TaxationSolutions. Our reputation speaks for itself.