Tax Tuesdays: Protecting yourself against scam artist
Better Business Bureau’s Kelvins Collins says everyone is considered a target for tax scams.
According to a BBB release, scam artists claim inflated personal or business expenses, false deductions, unauthorized credits or excessive exemptions, or returns prepared for their clients.
It’s likely fraudulent preparers may manipulate income figures to obtain fraudulent tax credits, such as the Earned Income Tax Credit.
Collins’ suggests watching for signs of a tax scammer:
Claiming that they can obtain larger refunds then other preparers.
Basing their fee on a percentage of the amount of the refund. Fees should be based on the complexity of the return, never on the size of the tax savings or refund.
Claiming they can get you immediate payment of your return. Keep in mind that this is a loan. Fraudulent tax preparers often pad their pockets by giving cash up front at a high interest rate while presenting it as an instant refund from the federal government.
Refusing to sign the tax return or provide the taxpayer a copy for his or her records. Always make sure that you have something in hand that shows proof of what transpired and you should have a receipt for services rendered.
To better protect yourself, ask your preparer about the current knowledge of the law and their training, and learn if the preparer has ever represented taxpayers in an audit, or been denied to do so.
These tips, and more can be found on www.bbb.org.