Tax Defense Network Fraud Watch: Common Tax Frauds Exposed

Most taxpayers have encountered tax fraud attempts at one point or the other. From receiving fake emails by tax scammers, to getting deceived by tax help companies, American taxpayers have fought and sometimes, fallen to tax fraud. Knowledge about tax fraud, therefore, is a shield, protecting taxpayers from tax thieves.

Tax Defense Network: Fraud of Fake IRS Web Forms

The IRS does not send emails to taxpayers, but tax frauds send them all the time, especially during tax season. The emails pretend to be from the IRS. The email looks official, with a copy of the IRS' seal. The emails state that there is new tool from the IRS called "Where's My Refund?" The email encourages taxpayers to check the status of their refund online by clicking on the link provided within the email but the link is a trap, because it does not lead to the legitimate IRS site. Instead, it leads to a fake imitation of the original IRS web page. Any information taxpayers enter into the fake webpage is viewed by the tax frauds.

Scammers ask the name of the taxpayer, their Social Security Number (SSN), and credit card information. They may use this information not only to file fraudulent tax returns on behalf of the taxpayers, but also to commit other financial thefts.

Tax Defense Network: Fraud of Tax Preparers

Tax fraud doesn't only happen online. Many have been conned when they seek help in tax return filing from a fraudulent tax preparer. Suspicious tax preparers can be easy to spot once taxpayers are familiar with the signs. First, they tempt you guaranteed with large refunds. Second, they discourage inquiries about their qualifications and history. Third, they make it difficult for taxpayers to check their tax return before filing. Finally, they usually do not have PTINs (Personal Tax Identification Number), or they have a newly opened shop.

To make the tax preparer accountable for the tax returns they file, the IRS has made it mandatory for every tax preparer to have a unique PTIN, which they must enter into every tax return they file. This has since been overturned in court. However, taxpayers should be wary of any tax preparer that doesn't have a way in place to track a tax return back to them.

Some of the common inaccuracies found in tax returns filed by fraud tax preparers include, bloated personal and business expenses, false deductions, fake credits, and lower income figures. Checking a tax return before a tax preparer files it can be save taxpayers from losing their refund money to fraud tax preparers, or worse having to pay a tax debt because of it.

Tax Defense Network: Fraud of Tax Relief Firms

One form of tax fraud is conducted by those who promise to relieve the tax debt burden of taxpayers but in fact burden taxpayers with outrageous fees while doing nothing to help with the back tax debt. Fraud tax relief firms charge bloated upfront fees with false promises of a substantial tax debt reduction. Taxpayers can easily expose fraud tax firms by inquiring about:

  • Their background
  • The qualifications of their tax professionals
  • The details of their resolution process
  • Their location of offices
  • Consumer complaints against them

Deeply researching a tax relief firm can help taxpayers expose the lies of a fraudulent tax company. Tax Defense Network believes in the power of knowledge and the necessity to share it with taxpayers.

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