IRS Alert – Bogus Tax Refunds


The IRS has sounded the alarm on bogus tax refunds, especially those that have to do with the college tax credit. Absurd as it may sound, these schemes promise that you can obtain a payment based on the American Opportunity Tax Credit, even if you are not enrolled in or paying for college. Such schemes have surfaced and claimed victims in California, Michigan, Louisiana, Alabama and Indiana. Among the victims are the senior citizens, families and church goers.

One popular characteristic of such schemes is that they promise refunds to people who have little or no income and normally do not required you to file a federal income tax return. IRS spokesman David Tucker said, “Most of these scams involve promoters who prey upon people in need, building false hopes. When victims' claims are rejected, their money and the promoters are long gone. We want to warn the public to be on guard and stop this new scheme before more innocent people are victimized.”

The IRS has come across thousands of such bogus refund claims over the last few weeks. As investigations are carried out, the IRS says the perpetrators can be subject to criminal prosecution if caught. These scammers would fleece their victims out of thousands of dollars in upfront service fees to do their filing. Some have charged as high as $500 for a false claim of $1,000. But the service fee is not the only amount you may lose if you are duped into such schemes. The IRS also holds you responsible for the accuracy of your tax return, meaning you would have to refund any claim you obtain fraudulently besides interests and penalties. Furthermore, if the IRS believes you knowingly intended to cheat the government you may be charged in a criminal court.

Here are some tell-tale signs to be aware of so that you are not taken for a ride by any of these bogus schemes:

• These schemes are claims for refunds or rebates based on tax credits you are not entitled to

• The schemes may approach you through the Internet and get you to call a toll-free number and ask for your Social Security number

• The schemes may be tax services that you never heard of selling refund and credit schemes to the membership of local churches

• You may receive home-made fliers or brochures that claim you can get credits or refunds without showing any proof of eligibility

• You may receive offers of free money without any having to provide documentation

• You may be offered services to prepare your taxes in exchange for a cut of your refunds

If you require tax services that are totally legal and above board, call us at (813) 229 7100 for a free consultation.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Darrin Mish, Tampa Tax Attorney, The Law Offices of Darrin Mish, P.A. | Attorney Advertising

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