Scams Targeting Tax Payers on the Rise

Posted December 8th, 2011
Written by RPD Staff

The Southeast of America is experiencing an alarming rise in the number of tax-related scams. According to Internal Revenue Officials, “If it sounds too good to be true, it probably is.” The IRS is referring to unscrupulous tax preparers who are conning taxpayers into unwarranted legal advice or charging exorbitant fees for activities that could be performed for free. “Most paid tax-return preparers provide honest and professional service, but there are some who engage in fraud and other illegal activities,” IRS spokesman Mark Green said.

“Unscrupulous promoters may deceive people into paying for advice on how to file false claims,” Green said. Other scammers are charging taxpayers for services they can acquire for free by the IRS or IRS-sponsored Volunteer Income Tax Assistance partners. “And, in some cases, identity theft is involved,” Green said.

Green noticed that recent scams are targeting church congregations, the elderly and low income families. Though the activity has been centered in Alabama and Mississippi, it is now affecting Georgia residents as well.

The IRS has been warning taxpayers not to be conned into filing false claims for tax credits or rebates for which they are not entitled. IRS media specialist Dan Boone is concerned about the spread of these scams over time. “This particular set of scams has been going on since May,” Boone said. “The scammers work all year long to try to entice people into doing things that will make money for them and trouble for the people that participate.”

Boone explains the types of scams that are pervading unsuspecting taxpayers. Scammers inform victims of unclaimed stimulus money and government rebates. “In today’s economy, the prospect of getting easy money is something some people will not question,” he said.

Due to the issues with Social Security, participants have not received a cost of living increase for years. Scammers use this information to trick seniors by making them fill out rebate request forms. “Here’s the rub,” Boone said. “The IRS erroneously processed some of these claims before we identified this as a scam. The sad part is those people who got these checks will be asked to repay these rebates along with interest and possibly penalties. Of course the scammers are long gone with the folks’ money at that point.”

Bethesda church member Charlene Parlett has noticed con artists calling participants of the church’s comprehensive financial course and requesting personal information. Thankfully, the church members were aware of the criminal tactics. “They were at least reading enough of the newspapers they didn’t fall for it,” Parlett said. “It seems the best defense for some of these scams is awareness.”

Parlett also recalled a total loss of $250,000 from five families who hired a criminal as a financial planner. “That individual is now serving nine years in a federal pen for doing the same thing to a group of individuals in New Jersey,” she said.

The IRS is currently partnering with law enforcement and the Better Business Bureau to investigate these types of scams. Boone is suggesting that people research the IRS website for information about tax credits and programs so they are knowledgeable if a situation should arise.