EAST TEXAS (TYLER MORNING TELEGRAPH) - The Internal Revenue Service is warning taxpayers about a scam by individuals pretending to be legitimate tax preparers.
The "preparers" lure taxpayers into filing fraudulent returns by promising larger than normal refunds while charging exorbitant fees. The IRS issued its annual "Dirty Dozen" list of scams in March, which included return preparer fraud.
"While most return preparers provide honest service to their clients, the unscrupulous prey on unsuspecting taxpayers by luring them into filing returns promising large refunds," Clay Sanford, IRS spokesman in Dallas, said in a prepared statement. "These preparers ask for little or no documentation, do not provide copies of returns and may be long gone by the time the victims realized they have been duped."
The typical victim is usually not required to file a return in the first place but is lured in by the promise of a large refund. The "preparers" create false income, deductions or credits to maximize the refund. Scams have involved bogus claims for veterans' disability benefits and for American Opportunity Tax Credits.
Taxpayers are legally responsible for what's on their returns even if it was prepared by someone else, Sanford said. Taxpayers can be liable for additional tax, interest and penalties due and subject to criminal prosecution, if complicit in the scheme. Victims who obtain refunds illegally could put some federal benefits to which they may be entitled to at risk.
The IRS reminds taxpayers to be careful when choosing and hiring an individual or firm to prepare their return. The IRS says to use only preparers who sign the return as the preparer; enter their IRS Preparer Tax Identification Number (PTIN); and provide you with a copy of the return.
For more, visitwww.irs.gov/chooseataxpro .