Revenooer Rants: Beware of the ‘Naughty 12’ this tax season
February 18, 2015
Or is it the "Dirty Dozen?" In any case, beware of the IRS' most worrisome tax scams, the more egregious of which (seven) are:
• Phone scams: These are aggressive and threatening phone calls by criminals impersonating IRS agents. The scam artists threaten police arrest, deportation, license revocation and other similar nasty results if you don't comply with their demands.
• Phishing: These are fake emails or websites designed to attempt to capture your personal information. The real IRS simply doesn't send you emails about the status of your account(s) with them; only letters which come by snail mail.
• Identity theft: IRS is always on the prowl for criminals who file fraudulent returns using legit taxpayers' Social Security numbers.
• Inflated refund claims: Be wary of anybody who promises you a hefty refund. (As the saying goes, if it's too good to be true, it probably is.) Don't sign a blank return, and watch out for preparers who charge fees based on a percentage of any refund.
• Fake charities: Beware of groups masquerading as charitable organizations to attract donations. Check out http://www.irs.gov, where IRS will make known to you all of the legit charities. If a group is not listed, don't deal with them. And in this regard, be wary of charities with names that are similar to familiar or nationally known organizations.
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• Abusive tax shelters: Yes, there are some of these still around, touted by unscrupulous promoters.
• Frivolous tax arguments: This is one of our favorites. Promoters of frivolous schemes (Google "Irwin Schiff" if you're looking for some entertainment in this area.) encourage folks to make unreasonable and outlandish claims to avoid paying Uncle Sam. Big penalties for doing this if IRS catches on.
And while you try your darndest to keep your tax bill down, take no comfort in the knowledge that in the current fiscal year through January, Federal tax revenues topped $1 trillion which just didn't seem to be quite enough, inasmuch as the government managed to run up a $194 billion deficit during that period!
Nonetheless, we hear that IRS will be changing its ways when it comes to seizing some taxpayers' bank accounts.
Last week, the Revenooers said they will change their policy, and apologized for seizing bank accounts from otherwise law-abiding business owners for no other reason than structuring their banking transactions to avoid federal reporting requirements.
Banking transactions above $10,000 are supposed to be reported to IRS in a certain way. IRS Commish Koskinen told Congress he doesn't know how many cases the more lenient policy will affect, noting that IRS seized a total of 147 accounts last year, including some in which the dough was, indeed, illegally obtained.
But Rep. Peter Roskam (R-Ill), Chairman of the House Ways and Means oversight subcommittee noted, "The IRS doesn't have to give notice to the account-holder before seizing the assets. And the IRS doesn't have to prove that the person is actually guilty of anything — just that the account probably is involved in (illegal activity)."
CONSULT YOUR TAX ADVISER -This article contains general information about various tax matters. You should consult your CPA regarding the implications to your own particular situation. Jeff Quinn is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He welcomes comments at email@example.com.
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