Here are the ITS Nasty 9 tax tricks that we think fraudsters could play on members of our community to scam folks out of their hard-earned dough. Our Nasty 9 are based on the IRS’s Dirty Dozen. We chose these because they are most likely to be what members of our community might see. With each trick, you can get more information from the IRS by clicking on the IR link.
The IRS won’t contact you out of the blue. If you didn’t message the IRS from their web form first, and you get an email that looks like it came from them, don’t even open it. Certainly don’t click any URL that may be in that email. To see examples of phishing read IR-2019-26.
#2 Phone Scams
The IRS will not call and threaten you if you do not pay them immediately. They also won’t demand that you pay them over the phone with gift cards. For more details about how scammers work this game, check out IR-2019-28.
#3 Identity Theft
Identity theft is a problem all year long, not just at tax time, but it is particularly troubling during tax season. Thieves can use your identity to file your taxes and take your refund. IR-2019-30 provides more information about recognizing and avoiding identity theft.
#4 Return Preparer Fraud
There are some tax preparers who aren’t legit. They can use tax season to steal your identity, make fraudulent tax claims using your information and other scams. Read more about the organizations that can help you make sure folks are legit in IR-2019-32.
#5 Inflated Refund Claims
Speaking of unscrupulous tax preparers — some pie-in-the-sky “preparers” have asked clients to sign a blank return with the promise of a big payday. Of course, their fee is “only” a percentage of your return. Don’t fall for it! If it is too good to be true, it probably is. You are legally responsible for what goes on to your tax return, no matter who helps you prepare it. Avoid filing phony returns by reading IR-2019-33.
#6 Falsifying Income to Claim Credits
Don’t lie on your return, and don’t let anyone convince you to. Filing your return as accurately as possible is the best defense against facing large bills for paying back taxes and penalties. Read about fake forms and made-up income in IR-2019-35.
#7 Fake Charities
Spartans have big hearts and give big. It pains us to have to say this, but double and triple check charities to whom you might want to give. IR-2019-39 provides links that will help you make sure the charities you want to give to are legit.
#8 Frivolous Tax Arguments
If someone tries to convince you that you don’t have to pay taxes (and that they can show you how for a “small, small fee”), give’em the stink eye and walk away. None of those tax arguments have ever worked, and the penalty for filing a frivolous tax return is $5,000. IR-2019-45 lays out the penalties for falling for this type of tax scam.
#9 Abusive Tax Shelters
If someone says to you, “I can show you how to hide your money from Uncle Sam,” turn away, my friend. They are likely trying to get you in on abusive tax shelters. Although, if you have that kind of money, I can hide it in a mason jar in my backyard for you. You’ll still have to pay your taxes on it though. IR-2019-47 shows you some of the crazy things people do to avoid paying taxes.
Be careful out there, don’t be fooled. #1040Defense #Nasty9
This is the last segment in our tax scam series for 2019. To look back at our other articles, see https://itsnews.uncg.edu/topics/taxscamseason/.