IRS 2023 Dirty Dozen – Scam #6:  Unscrupulous Tax Return Preparers  (Part A)

IRS 2023 Dirty Dozen – Scam #6:  Unscrupulous Tax Return Preparers  (Part A)

People should be careful of shady tax professionals and watch for common warning signs, including charging a fee based on the size of the refund. Some “ghost” tax preparers refuse to sign the tax return or ask people to sign a blank return. These are all common warning signs, and people should always rely on a trusted tax professional, and the IRS offers a variety of resources to help.

“Most tax professionals offer excellent advice and can really help people navigate complex tax issues. But we continue to see instances where taxpayers are “ghosted” by unscrupulous tax preparers with bad advice who quickly disappear,” said IRS Commissioner Danny Werfel. “We encourage taxpayers to check out the tools and resources available to them to ensure they find the right tax professional for their needs.”

Choose carefully: Check credentials of tax return preparers

Taxpayers should choose a tax preparer as carefully as they choose a doctor or lawyer. After all, the tax preparer is entrusted with sensitive personal and financial information. While there are different types of tax preparers with varying levels of credentials and qualifications, there are constants when it comes to finding a preparer:

  • A taxpayer’s individual needs will determine which kind of preparer is best for them.
  • Taxpayers are ultimately responsible for all the information on their income tax return, regardless of who prepares the return.
  • Tax professionals are required to have an IRS Preparer Tax Identification Number (PTIN) to prepare federal tax returns.

The IRS offers resources for taxpayers to educate themselves on types of preparers, representation rights, as well as a Directory of Federal Tax Return Preparers with Credentials and Select Qualifications. This directory can help taxpayers find a return preparer with specific qualifications to fit their needs. The directory is searchable and sortable.

Next week  #6: Unscrupulous Tax Return Preparers (Part B)

(IRS Web Site  (TTT 0725423)