Tax day’s approach on April 18 has sparked a reminder from the Internal Revenue Service about the “Dirty Dozen” tax scams the IRS encounters.
The IRS announced that of these scams, hiding income in offshore accounts, identity theft, return preparer fraud and filing false or misleading tax forms top the list in 2011.
Other scams in the Dirty Dozen include invoking frivolous arguments, non-taxable Social Security benefits with exaggerated withholding credit, abusing charitable organizations and deductions, abusive retirement plans, disguised corporate ownership, phony wage information, misuse of trusts and fuel tax credit scams.
David Tucker of IRS field media relations said it’s important to highlight such activities this time of year because while some are invoked by those filing, others can become victims of scams.
“The Dirty Dozen represents the worst of the worst tax scams,” IRS Commissioner Doug Shulman says in a release. “Don’t fall prey to these tax scams. They may look tempting, but these fraudulent deals end up hurting people who participate in them.”
The IRS warns that scam promoters frequently end up paying heavy fines and imprisonment. Those who get involved wittingly or unwittingly must repay all due taxes plus interest and penalties.
Suspected tax fraud can be reported to the IRS using Form 3949-A, Information Referral or through a letter detailing the alleged fraudulent activity. The report may be mailed to the Internal Revenue Service, Fresno, CA 93888. The identity of the person filing the report can be kept confidential.
In terms of identity theft or phishing, Tucker said not to open suspicious emails. Such emails or Internet addresses that don’t begin with http://www.irs.gov should be forwarded to the IRS at firstname.lastname@example.org.
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