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Hand holding a paper with the word 'scam' written - Tax Scams

The IRS Issues Update To The Tax Scams To Be Aware Of For 2023 And Beyond

Tax season is upon us again! While it’s a time to settle your tax obligations, it’s also a prime target for scammers. The IRS releases a yearly list of the “Dirty Dozen” tax scams – the most prevalent schemes used to steal your money and personal information.

This guide will equip you to identify and avoid these scams, ensuring a safe and secure tax filing season.

The IRS Dirty Dozen: A Breakdown

The Dirty Dozen highlights the most common tax scams that target individuals and businesses throughout the year, especially during tax season. These scams not only risk financial loss but also compromise your personal data and identity.

Here’s a crucial rule to remember: Never share sensitive information like Social Security numbers, bank accounts, or passwords over the phone, email, or social media. Scams often hinge on unsuspecting victims overlooking this basic principle.

Watch Out for These Tax Scams:

  • Employee Retention Credit Cons: Beware of aggressive promotions promising hefty tax savings through the Employee Retention Credit. Scammers often misrepresent eligibility requirements and credit amounts.
  • Phishing and Smishing: Phishing emails or unsolicited text messages (smishing) try to trick you into revealing personal or financial information by impersonating legitimate organizations like the IRS or tax preparation services.
  • False Fuel Scams: Businesses with work vehicles are targeted by scammers offering inflated tax refunds through fabricated fuel tax credits. The legitimate Credit for Federal Tax Paid on Fuels requires filing Form 4136.
  • Fake Charity Scams: Malicious actors exploit your generosity by soliciting donations for bogus charities. They not only steal your money but potentially use the information for identity theft. Remember, tax-deductible donations are only allowed to qualified charities. Ask about their tax-exempt status to deter scammers.

Additional Red Flags:

  • Third-party intervention: The IRS will contact you directly via mail for any tax-related issues. Be wary of unsolicited help with your IRS Online Account.
  • Unreliable Tax Preparers: Research and choose reputable tax preparers to avoid falling prey to unscrupulous individuals who might steal your information or inflate fees.
  • Misleading Social Media Advice: Don’t rely on unverified social media information for tax advice. Trust official IRS resources or consult a qualified tax professional.
  • “Offer in Compromise” Mills: These scams promise to settle your tax debts for a fraction of the amount owed, but they are not affiliated with the IRS.

Why Choose a Tax Professional?

Tax scams highlight the importance of proper tax preparation. If you’re uncomfortable filing yourself, especially for complex situations or businesses, consider hiring a trustworthy tax professional.

A qualified professional will not only ensure accurate tax filing but also possess the expertise to identify and shield you from these scams. Peace of mind and protection from fraud are invaluable benefits when it comes to tax season.

Stay Informed and File Securely

By familiarizing yourself with the Dirty Dozen tax scams and following safe practices, you can navigate tax season with confidence. Remember, the IRS prioritizes taxpayer protection and offers extensive resources on their website. Don’t hesitate to seek help from a qualified tax professional if needed.

Empower yourself with knowledge! File your taxes securely and avoid falling victim to scams this season.

JS Morlu LLC is a top-tier accounting firm based in Woodbridge, Virginia, with a team of highly experienced and qualified CPAs and business advisors. We are dedicated to providing comprehensive accounting, tax, and business advisory services to clients throughout the Washington, D.C. Metro Area and the surrounding regions. With over a decade of experience, we have cultivated a deep understanding of our clients’ needs and aspirations. We recognize that our clients seek more than just value-added accounting services; they seek a trusted partner who can guide them towards achieving their business goals and personal financial well-being.
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