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In February 2015, the IRS released a list of the top twelve illegal tax scams for which people must watch out. Included on the list are scams that target unsuspecting taxpayers, as well as scams committed by taxpayers that the IRS is investigating. Concerned about your taxes for this year? Contact a Roseville tax lawyer of NewPoint Law Group.

Tax Scams to Be on the Look-out for

Phone Scams: There’s a chance you may receive threatening phone calls made by criminals claiming to be from the IRS. Many of these scammers threaten arrest, license revocation, or worse. Be sure to contact a tax professional if you receive a threatening phone call from someone claiming to be from IRS.

Phishing: Be wary of any emails or websites asking for your personal information. The IRS does not initiate any contact with taxpayers by email to request personal information.

Identity Theft: Many taxpayers have been victims of identity theft in recent years by criminals that file fraudulent returns using someone else’s Social Security Number. If this happens to you, be sure to file a police report, respond to any IRS notice immediately, and complete and submit IRS Form 14309, Identity Theft Affidavit. You should continue to file your tax returns and pay your taxes, even if you have to mail in a paper return.

Return Preparer Fraud: Don’t fall prey to a dishonest tax return preparer. Some have been known to commit refund fraud, identity theft, or other scams such as misleading taxpayers into taking deductions or credits that they aren’t entitled to for an increased fee. You are ultimately responsible for what is on your tax return, and may be on the hook for taxes, interest, and penalties, so be careful in selecting a reputable tax return preparer.

Offshore Tax Avoidance: The IRS has been going after offshore income and accounts for several years now, and there are no signs of it slowing down. If this applies to you, be sure to take advantage of the offshore voluntary disclosure program before it is too late.

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Inflated Refund Claims: If someone promises you a large refund without looking at your tax documents, or charges a fee based on a percentage of your refund, run away as fast as you can. Tax preparers are not allowed to charge fees based on your refund, and nobody can guarantee a refund without knowing the individual’s circumstances. It is easy for someone to enter fake deductions or credits on your behalf. It is not so easy for you to get yourself out of the trouble that will result. It is also highly doubtful that you will be able to locate that preparer when you come under audit.

Fake Charities: If you are unsure if a charity is legitimate, take a moment to verify the status of the charitable organization at http://www.irs.gov/Charities-&-Non-Profits/Search-for-Charities.

Hiding Income with Fake Documents: If someone recommends that you file false documents to reduce your tax bill, ask yourself if it is worth sitting in jail next to that person before agreeing to it.

Abusive Tax Shelters: There can sometimes be a fine line between abusive tax schemes and legitimate tax savings advice. Always seek the advice of independent counsel if you aren’t sure whether a particular tax savings strategy is legitimate.

Falsifying Income to Claim Credits: The IRS is aware of taxpayers who sometimes claim income that did not exist in order to take advantage of certain tax credits–most notably the earned income credit. Be careful about working with someone who suggests claiming income that you did not actually earn.

Fuel Tax Credits: This specific credit is limited to off-highway business use, so be sure to do your homework if you are claiming this credit.

Frivolous Tax Arguments: There are many groups that promote frivolous tax arguments to avoid paying taxes. There are huge penalties for filing frivolous returns, or making arguments against the imposition of tax due to some frivolous claim. Just remember, if you are asked to join a tax protester group, research what happened to Wesley Snipes before going to any meetings: http://www.cnn.com/2013/04/05/showbiz/wesley-snipes-released/.

Rely on a Sacramento Tax Lawyer that Can Give You Proper Guidance

An experienced Sacramento tax attorney of the NewPoint Law Group can fight to protect you from a worst-case scenario. To discuss how we can steer and guide you through your tax law issue or troubles with the IRS, call us at 1-800-358-0305 or contact us online today.