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Tax Fraud
African-American Reparations Tax Scam
Thousands of African-Americans have been misled for years by people offering to file
for tax credits or refunds related to reparations for slavery. This scam has a distant
factual basis. Shortly after the Civil War, Congress voted to provide former slaves
with 40 acres and a mule as payback for their years in slavery. President Andrew Johnson
vetoed the bill. Though politicians and various media discuss the reparations issue
for descendants periodically, there currently is no tax law that allows for any
slavery-related tax breaks.
Some unscrupulous promoters encourage clients to pay them to prepare a claim
(a misfiling of Form 2439, Notice to Shareholder of Undistributed Long-Term
Capital Gains) for this invalid refund. But the claims are a waste of money.
Plus, those who file subsequent claims can be subject to a $500 frivolous
return penalty.
How to Report Suspected Tax Fraud Activity
Suspected tax fraud can be reported to the IRS using IRS Form 3949-A, Information Referral.
Form 3949-A is available for download from the IRS Web site at IRS.gov, or through the U.S.
Mail by calling 1-800-829-3676. The completed form or a letter detailing the alleged fraudulent
activity should be addressed to the Internal Revenue Service, Fresno, CA 93888. The mailing
should include specific information about who is being reported, the activity being reported,
how the activity became known, when the alleged violation took place, the amount of money
involved and any other information that might be helpful in an investigation. The person
filing the report is not required to self-identify, although it is helpful to do so. The
identity of the person filing the report can be kept confidential. The person may also be
entitled to a reward.
Related Tax Fraud Links:
IRS Free Online Filing
The "Dirty Dozen" Tax Scams
Tax Scams - How to Recognize and Avoid Them
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