It's tax season. Are you being scammed?

The Retirement Planning Specialist

Revisiting IRS Alert on Tax-related Scams With the onset of tax season the Internal Revenue Service recently issued its annual “Dirty Dozen” list of tax scams. 
These range from identity theft to fraud perpetrated by tax preparers. 
We focus here on the half-dozen areas most likely to trip up the unsuspecting.
Identity Theft is used to commandeer a taxpayer’s information to file a return and claim a fraudulent
refund. The tip off may be an IRS notice informing you that multiple returns were filed in your name, or that you received wages from an employer you’ve never heard of. 
If you believe your personal information has been stolen and used for tax purposes, contact the IRS Identity Protection Specialized Unit (see www.IRS.gov/identitytheft). 
Phishing is typically carried out via unsolicited email or fake websites posing as legitimate to induce
victims to provide personal and financial information. 
If you receive an unsolicited email that purports to be from the IRS or an organization closely linked to the IRS, such as the Electronic Federal Tax Payment System (EFTPS), report it to: 
phishing@irs.gov. 
The IRS does not initiate contact by email to request personal information from taxpayers.
Return Preparer Fraud may include refund skimming, inflated fees, refund guarantees, basing fees
on a split of any refund, and encouraging the submission of false information on returns. 
A paid preparer should have a Preparer Tax ID Number (PTIN) and enter it on returns.
“Free Money” from the IRS & Scams Involving Social Security often target the elderly and have been appearing in community churches and other “affinity” groups. 
Promoters charge to prepare and submit a claim for a credit or refund that is either nonexistent or grossly inflated. Such filings can trigger a $5,000 penalty.
Abuse of Charitable Organizations and Deductions includes efforts to shield income or assets from taxes while keeping control of the assets and associated income.
Overvaluing gifts to inflate tax deductions is a common problem.
The Pension Protection Act of 2006 raised penalties for inflated appraisals and set new appraisal standards.
Misuse of Trusts often arises from promoters’ bogus claims of income and/or estate tax savings.
There are many legitimate uses of trusts in tax and estate planning, but the IRS has seen a rise in the improper use of private annuity trusts and foreign trusts to shift income and deduct personal expenses. 
Seek the advice of a trusted professional before entering a trust arrangement.
When it comes to taxes, an old adage from the investment world is equally apt: If it seems too good to be true, it probably is.

I am not a CPA or a professional tax preparer. This information is provided as general guide line and not meant to be advise. Always consult your CPA or Tax preparer about your own situation or visit the IRS web site for the most accurate information.