Top 12 Tax Scams

Some you’ll expect – others are very sophisticated.  Scammers are still out there even after April 15th

Telephone Scams:  Callers threaten people with police arrest, deportation, license revocation or other actions.

Phishing:  Unsolicited emails or websites lure potential victims and prompts them to provide personal and financial information – causing identity theft or financial theft.

Identity Theft:  without ones permission, someone uses your personal information – your name, Social Security Number (SSN) or other identifier to perpetuate fraud – such a filing a tax return with a refund claim.

Charitable Imposters:  especially after a major disaster, scammers come of the woodwork.  You may be contacted by phone or email for donation

Tax Return Preparer Fraud: the vast majority of tax return preparers are honest.  But some disreputable preparers set up shop during tax filing season, resulting in fraud or identity theft.
which may also lead to…..

Inflated Refund Claims:  fake tax return preparers lure victims in by promising large or unrealistic federal tax refunds.  They may use fliers, advertisements, phony storefronts or personal contact to spread the word, even going through community groups or churches where trust is high.

Offshore Assets:  taxpayers may evade tax responsibilities by hiding income in offshore banks, brokerage accounts or nominee entities and then using debit or credit cards or wire transfers to access the hidden cash.  Other schemes are based on foreign trusts, employee leasing, private annuities or insurance plans.

Fake 1099 and W-2s:  criminals may use self-prepared, corrected or otherwise falsified forms to improperly report taxable income as zero.

Abusive Tax Shelters:  these can range from domestic and foreign trust arrangements to sophisticated strategies using foreign financial secrecy laws or credit or debit cards issued by offshore financial institutions.  Typically, multiple flow-through entities are an integral part of the scheme.

False income, expense or exemptions: unscrupulous tax preparers may help facilitate this process by inflating or including income on a tax return when the wages were never earned

Unauthorized Fuel Credits:  generally limited to off-highway business use or farming, don’t be enticed by preparers pushing this erroneously for a higher refund.

Frivolous Tax Arguments:  be wary of promoters pushing arguments for avoiding tax filing.​
Back to News