It is fitting that March 6-12 is National Consumer Protection Week. This time of year it’s hard to avoid the fliers, yard signs, emails, and other advertisements offering tax preparation assistance and promising bigger, faster refunds. The fact is, tax time is prime time for scammers.
It’s also a good time of year to remember that older adults are high profile targets for financial exploitation and abuse, costing seniors an estimated $3 billion a year. Even though they may not be required to file an income tax return, seniors are a prime target for tax scammers. They are led to believe they should file a return to receive Social Security rebates for excess withholding or that they are eligible for certain tax credits that could get them a refund.
Be cautious if…
You are approached by an individual or company who offers to prepare your taxes, and help you get a larger tax refund than other preparers. The preparer may even base his/her fee on a percentage of your refund.
The preparer may approach you at your church or in your neighborhood or housing complex. He/she may also contact you via email or through a flier or advertisement.
You are expecting a refund. Someone might promise you a bigger, faster refund, but what you will likely end up with is a Refund Anticipation Loan (RAL) An RAL can be costly, and paying for a loan may not be necessary given how quickly you can get your refund from the IRS. Know your options and the questions to ask so your refund doesn’t cost you in the long run.
Someone contacts you (by phone, in person, or by e-mail) claiming to be a representative of the IRS. They may claim you owe taxes, even threaten to arrest you if you don’t put money on a prepaid debit card and tell them the card number. They might know all or part of your Social Security number, and can fake caller ID information to make it look like it really is the IRS calling. The video below is funny, but the message is clear: The IRS doesn't call you. Ever.
Unlike this video, tax scams are no joking matter. Remember. The IRS will NEVER call you directly.
The IRS`s Criminal Investigation Unit offers the following tips for avoiding tax preparation scams:
Be cautious of tax preparers who claim they can get larger refunds than other preparers, or who base their fee on a percentage of your refund.
Only use a reputable tax professional that signs your tax return and provides you a copy.
Consider whether the individual or firm will be around to answer questions about the preparation of the tax return months, or even years, after the return has been filed.
Check the preparer`s credentials. Only attorneys, certified public accountants (CPAs) and enrolled agents can represent taxpayers before the IRS in all matters including audits, collections and appeals.
Find out if the preparer is affiliated with a professional organization that provides its members with continuing educational resources and holds them to a code of ethics.
Ask friends and family whether they know anyone who has used the tax preparer before, and whether they were satisfied with the service they received.
Never share personal or financial information appearing as a request by email from the IRS. The IRS does not initiate requests for personal or financial information via email, text messages or social media.
Reporting Tax Frauds and Scams
If you think you are a victim of a tax scam, report it right away! Contact the Cincinnati office of the IRS Criminal Investigation Unit at (513) 263-3335.
Free Tax-Prep Assistance
In cooperation with the IRS, the AARP Foundation Tax-Aide program helps low- to moderate-income taxpayers by assisting with tax services and ensuring they receive applicable tax credits and deductions. The program is available free to taxpayers with low and moderate income, with special attention to those 60 and older. Click here for more information and to find a location near you.
MyFreeTaxes is a United Way-supported free online service for filing federal and state taxes using your own computer. It’s free, easy and safe, and offers one-on-one help through phone or chat.
Scammed? Now what? This new fact sheet from the National Center on Elder Abuse provides guidance for victims of scams. It includes key questions to address and where to go for help. Download the fact sheet
March 6-12 is National Consumer Protection Week National Consumer Protection Week 2015 takes place March 1-7. Go to ncpw.gov to find consumer tips and free materials from government and private organizations.
Consumer Protection Forum March 30, 2016, 4-6:30pm Maple Knoll Village Auditorium 11100 Springfield Pike, Cincinnati, OH 45246 Click here for more information