The Internal Revenue Service warns you to be on guard for a tax scam aimed at seniors.
Scam artists are on the loose in Illinois, promising refunds to folks with little or no documentation.
Scam artists are persuading seniors to file fake tax returns. The agencies say they're filing tax returns for a fee, to get the withholding money from social security benefits. Often the person isn't eligible in the first place.
That leaves victims finding they have rejected claims or not enough money to cover the initial fee.
Here are some things you should be wary of:
- Unfamiliar tax services teaming up with local community organizations like churches.
- Flyers or brochures implying refunds are available without proof of eligibility.
- Also watch especially for offers of free money with no documentation required.
As always, review your tax return to make sure all information is accurate. Some scam artists are turning in returns that end up getting victims into trouble, simply because the information is false or exaggerated.
Read the warning straight from the IRS below:
(IRS) -- The Internal Revenue Service is encouraging Illinoisans to be on guard against tax scams promoted by unscrupulous individuals trying to persuade them to file false tax returns.
These tax scams have, in many cases, targeted taxpayers in the Midwest and have been seen throughout Illinois.
“We are seeing tax scams in Illinois that target seniors and low income individuals. Some scams encourage people to file tax returns, for a fee, to get a refund on withholding from Social Security benefits,” said Sue Hales, IRS spokeswoman for Illinois. “However, if withholding never actually occurred, taxpayers would not be eligible for this refund.”
Most paid tax return preparers provide honest and professional services, but there are some who engage in fraud and other illegal activities. Unscrupulous promoters of tax scams often prey upon low income individuals and seniors. They build false hopes of a refund and charge people good money for bad advice. In the end, victims of these scams discover their claims are rejected or the refund barely exceeds what they paid the scam promoter. Meanwhile, their money and the promoters are long gone.
“The IRS is seeing an increase in tax scams, frequently involving taxpayers who normally do not have to file a tax return,” Hales said. “We’re asking taxpayers to remain vigilant. If something sounds too good to be true, it probably is.”
Flyers and advertisements for free money from the IRS have been circulated at community organizations including churches and organizations that assist seniors, exploiting their good intentions and credibility. The flyers suggest that taxpayers can file a return and get a refund with little or no documentation. These fraudulent schemes are often spread by word of mouth among unsuspecting and well-intentioned people telling their friends and relatives.
Taxpayers should be wary of any of the following:
Fictitious claims for refunds or rebates based on excess or withheld Social Security benefits.
Claims that Treasury Form 1080 can be used to transfer funds from the Social Security Administration to the IRS enabling a payout from the IRS.
Unfamiliar for-profit tax services teaming up with local community organizations including churches.
Home-made flyers and brochures implying credits or refunds are available without proof of eligibility.
Offers of free money with no documentation required.
Promises of refunds for “Low Income – No Document Tax Returns.”
Claims for the expired Economic Recovery Credit Program or the Recovery Rebate Credit.
Advice on using the Earned Income Tax Claims based on exaggerated reports of self-employment income.
In some cases, non-existent Social Security refunds or rebates have been the bait used by con artists. In other situations, taxpayers deserve the tax credits they are promised but the preparer uses fictitious or inflated information on the return which results in a fraudulent return.
“Taxpayers should choose carefully when hiring someone to prepare their tax returns,” said IRS Criminal Investigation Division Special Agent in Charge, Al Patton. “While most return preparers are honest and provide an excellent service, a few unscrupulous return preparers file false and fraudulent returns to defraud the government and their clients. Don’t forget that even if you pay someone to prepare your tax return you, the taxpayer, are ultimately responsible for all of the information on that tax return. If the return contains incorrect information, you will be responsible for paying any additional taxes and penalties.”
Patton further advised taxpayers to always review their tax returns before signing them and to question any items they do not understand.