Consumer Watch: The tax scam that could leave you holding the bag

Last minute taxpayer warnings

As tax time draws near scammers can target anyone who is waiting until the last minute to file.

Tax day this year is on April 18th, so you still have a few days to get everything done if you still haven't finished your taxes. However, if you are shopping around to see if a tax preparer can get you an unbelievable return, watch out, that could be a possible scam, that would leave you holding the bag.

More than half of Americans outsource tax prep. This means they hire a tax professional to prepare their filing, and that is a lot of trust to place on a person. If a tax preparer over promise huge returns, to keep those promises, the unethical could file a fraudulent return. The problem here, is that you would be responsible for any problems that result from filing a fraudulent return.

“The bottom line is this: no matter who prepares your tax return, you the taxpayer are the one responsible for the information on it,” says Raphael Tulino, an IRS spokesperson.

The best way to avoid tax preparer fraud is to ask questions. Here is the information you need from the person doing your taxes:

  1. What are your qualifications?
  2. Do you have a preparer tax id number?
  3. Are you available to be contacted later in the year?

Those recommended questions come from the IRS, and can help when deciding who to hire.

“Most preparers are doing the right thing, and preparing honest returns for all of their clients, but certainly you want to be sure when you are choosing,” says Tulino.

The IRS also says you should avoid preparers who base their fee of a percentage of your refund, or those who say they can get larger refunds than others can.

That is just a few of the multitude of tax scams. A major reminder, especially as returns start coming in, The IRS does not contact people by phone on fist contact, if the IRS is trying to get in contact with a taxpayer, they would receive an official letter first.

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