Tax Fraud Information
The IRS warns that tax scams, fraud and outright cheating could make tax season a lot less enjoyable than it already is if you get caught.
We
all know that the tax man cometh and that paying our fair share of taxes is something we cannot legally avoid. Or do we? Unfortunately
there are people are so caught up in trying to figure out a way to get a larger refund or pay less tax that they easily fall prey
to unscrupulous tax preparers, identity thieves and less-than-helpful credit counselors. Let us also not forget such as dubious
offshore transactions, abusive trust schemes and just lying about how much you made last year. There are countless ways to wind
up in hot water over your taxes if the IRS catches you.
If someone tells you that they can eliminate your taxes completely you should be especially skeptical. There is no silver bullet
for taxes. We all have to pay them. But because people will do almost anything to avoid paying taxes they make themselves easy
prey for con artists that are ready, willing and able to capitalize on taxpayer angst. Do you know how to tell a legitimate tax
deduction from a fraudulent claim?
Pay them now or pay them later
So what happens when you get caught up in one of the scams to lower your tax bill? First of all you are out the money you paid
for your service and on top of that you will have to pay some pretty hefty penalties and the interest owed on past tax bills can
set you back quite a bit. It doesn't matter that you were the victim of a con you will still owe your tax debt to the IRS.
If you knowingly participate in a tax scam you could even face jail time. So while we all hate paying taxes and want to pay as
little as possible, don't fall for any of these schemes. You'll end up paying your taxes in the end. You can either pay them
now and avoid jail, fines and the interest on your original tax bill or you can pay them later plus interest, fines and possibly
enjoy a vacation at a federal resort. We also urge you to remember the Golder Rule: If something seems too good to be true
then it probably is.
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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