Tax filing season opens today, and Better Business Bureau is warning consumers about a tax preparer fraud. According to the IRS, tax preparer fraud occurs when a preparer “alters return information without their clients’ knowledge or consent in an attempt to obtain improperly inflated refunds or to divert refunds for their personal benefit.” To avoid fraud and find a trustworthy professional to help you prepare your taxes, BBB offers these tips:
- Get references and do your research. Get referrals from friends and family on who they use and check out the company at bbb.org to see its BBB Business Review.
- Look for credentials. Seek a tax pro who is an enrolled agent, certified public accountant or a tax attorney. These preparers have completed extensive examinations on tax matters and must stay current by meeting continuing professional education requirements. Only CPAs and tax attorneys can represent you in U.S. Tax Court if you are audited.
- Get a firm estimate in writing. The cost of preparing your return will vary depending on the complexity of your information. Before you agree to move forward, present all of your information and get a firm estimate in writing.
- Don’t fall for the promise of a big refund. Be wary of any tax preparation service promising larger refunds than the competition, and avoid tax preparers who base their fee on a percentage of the refund.
- Protect your identity. The IRS has issued several consumer warnings about the fraudulent use of the IRS name or logo by scamsters trying to gain access to consumers’ financial information in order to steal their identity. The IRS does not initiate taxpayer communications through email. Unsolicited email claiming to be from the IRS, or from an IRS-related component such as the Electronic Federal Tax Payment System (EFTPS), should be reported to the IRS at firstname.lastname@example.org.