Your money refunded if you’re not satisfied
”
is a typical guarantee. But for tax scams, the catch is this:
Crooks find your money so satisfactory that you will never see it
again.
The IRS has identified twelve major tax schemes taxpayers should
avoid.
Your money refunded if you’re not satisfied” is a typical guarantee. But for tax scams, the catch is this: Crooks find your money so satisfactory that you will never see it again.
The IRS has identified twelve major tax schemes taxpayers should avoid.
1. Offshore major transactions. This con involves sending income to offshore banks to avoid taxes.
2. Identity theft. Thieves use official-looking forms to trick you into providing your social security number and financial information.
3. Phony tax payment checks. Con artists “lend” you money using bogus checks called “sight drafts.”
4. African Americans get a special tax refund. This tax scheme is based on phony credits or refunds related to reparations for slavery.
5. No taxes withheld from wages. For a sum, a crook will tell you how to prevent your employer from withholding payroll taxes.
6. Home-based business deductions. The con artist tries to convince you there’s a way to deduct personal expenses as business expenses.
7. Pay the tax, then get the prize. This scam comes in the form of a phone call or letter saying you’ve won a prize, which you’ll receive as soon as you pay the “tax.”
8. Frivolous arguments. A con artist tries to convince you that paying taxes is voluntary.
9. Social security tax scheme. Tricksters claim you can receive a refund of social security taxes.
10. “I can get you a big refund for a fee!” Promoters of this fraud want you to file a false W-2 and split the refund.
11. Share/borrow EITC dependents. This scheme involves letting someone “borrow” your dependents to claim the earned income credit.
12. IRS “agent” comes to your house to collect. Imposters show up at your door requesting payment of taxes.
Don’t fall for any of the “dirty dozen” tax frauds, or you may find yourself minus your money and subject to IRS penalties.
Barbara Andres is a CPA and a partner with the accounting and business consulting firm of Bianchi, Lorincz & Company located in downtown Hollister.
