Top 10 tips to avoid tax season fraud

Each year, taxpayers’ personal information is compromised through phishing scams or by unscrupulous tax preparers. With tax season kicking off on January 24, IRS Criminal Investigation (IRS-CI) wants taxpayers to be aware of tax-related fraud.

“As the investigative arm of the IRS, we see the impact that fraudsters have on taxpayers,” said Darrell Waldon, Special Agent in Charge of the Washington D.C. Field Office. “This tax season, we want to remind U.S. taxpayers about ways they can protect their wallets and personal information.”

Tips to avoid tax season fraud include:

1. Choose a tax preparer wisely. Look for a preparer who is available year-round.
2. Ask your tax preparer for their IRS Preparer Tax Identification Number (PTIN). All paid preparers are required to have one.
3. Don’t use a ghost preparer. They won’t sign a tax return they prepare for you.
4. Don’t fall victim to tax preparers’ promises of large refunds. Taxpayers must pay their fair share of taxes.
5. Don’t sign a blank tax return. Taxpayers are ultimately responsible for what appears on tax returns filed with the IRS.
6. Make sure you receive your refund. Your refund should be deposited into your bank account, not your tax preparer.
7. The IRS will not call you threatening legal action. If you receive a call like this, hang up.
8. Don’t respond to text messages, emails or social media posts claiming to be the IRS. They may contain malware that could compromise your personal information.
9. Don’t click links or open attachments in unsolicited emails or text messages about your tax return. These messages are fraudulent.
10. Protect your personal and financial information. Never provide this information in response to unsolicited text messages, emails, or social media posts claiming to be the IRS.

Recent cases of tax preparer fraud:

• D.C. tax return preparer sentenced to 14 months in prison for carrying out a tax scheme
  Yohanness Ayechew of Washington, D.C., was sentenced to 14 months in prison last November for filing false tax returns and causing at least $250,000 of loss to the Internal Revenue Service. He and his business partner operated Endalk and Yohannes Associated, L.P. in D.C. since 2011, where he prepared false income tax returns for clients that overstated business expenses and claimed exemptions to give them bigger tax returns than they were entitled to receive.
• Former Maryland tax preparer sentenced to more than two years in federal prison for a tax fraud conspiracy
  Anita Fortune, of Alexandria, Virginia, was sentenced to 30 months in federal prison last summer, followed by three years of supervised release, and ordered to pay restitution for filing false tax returns using a false ID provided by her co-conspirators. She and her co-conspirators also fabricated, inflated, and improperly claimed deductions on their clients’ returns to inflate their refunds.

For more tips on choosing a tax professional or how to file a complaint against one, visit IRS.gov. Taxpayers who suspect tax violations by a person or business may report it to the IRS using Form 3949A, Information Referral. Taxpayers can report phishing emails to phishing@irs.gov or IRS impersonation scams to TIGTA.gov.

This year’s tax season began Monday, January 24, and continues through Monday, April 18 for most taxpayers. U.S. taxpayers are subject to tax on worldwide income from all sources and must report all taxable income and pay taxes according to the Internal Revenue Code. Taxpayers found to be committing fraud may be subject to penalties including payment of taxes owed plus interest, fines, and jail time.

IRS-CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money laundering, public corruption, healthcare fraud, identity theft, and more. IRS-CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, boasting a nearly 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 11 attaché posts abroad.