IRS’s Dirty Dozen Tax Scams

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The Internal Revenue Service has released its annual list of "Dirty Dozen" tax scams to alert taxpayers to the dangers of unscrupulous scam artists who most often prey on the elderly and the poor.

"Although the IRS’s alert was aimed at the tax season when most of the scams are perpetrated," said Deborah Lamb, a Dennisville C.P.A. who provides financial services to those seeking personal care, "the reality is that scams are a year-round ‘business’ now operating on a global scale. With today‘s sophisticated communications capabilities, the scammer could be operating in Nigeria or New Jersey – and you would never know the difference."

Among the IRS’s Dirty Dozen are the following:  identity theft; return preparer fraud; hiding income offshore; “free money” from the IRS and tax scams involving Social Security; fake charitable organizations; false/inflated income and expenses; frivolous tax arguments; false Form 1099 refund claims; disguised corporate ownership; falsely claiming zero wages; misuse of trusts, and phishing.

“Phishing,” Lamb explained, “is information gathering through email hijacking with the information then used to access the sender’s assets.”

She warned that scam artists have become very clever over the years and that is what makes them so dangerous—and believable.

“It’s hard for some people, especially those who don’t make or have a lot of money, to resist the lure of free money from the government that the scam artist promises,” she says. “The best defense is to check with your financial advisor before you rise to the bait.  If you don’t have professional help, then remember the old saying, ‘If it sounds too good to be true, it probably is.’”