In order to better prepare you for signs of suspicious activity, here are a few scams you should know about as we go into tax season 2020.
Ghost Preparers
If your IRS tax return preparer won’t digitally sign your electronic return or physically sign your paper return, this is a huge red flag. That’s because each preparer has an assigned Preparer Tax Identification Number (PTIN). “Paid preparers must sign and include their PTIN on the return,” the IRS says.
Other red flags include if your preparer bases his or her fee on a percentage of your refund—preparers should have fixed rates regardless of your return—and/or s/he encourages you to lie about your deductions and/or income in order to increase your refund.
To ensure your tax preparer is legitimate, check out the Better Business Bureau’s Business Profiles. Michelle L. Corey, Better Business Bureau (BBB) St. Louis President and CEO says, “BBB Business Profiles are a great way to check out any business, including tax professionals, such as accountants, lawyers or other preparers.”
IRS Impostors
Have you received a phone call saying your Social Security Number (SSN) has been compromised and you need to call someone to secure it? Scam. These scammers usually say they’re from the IRS or the Social Security Administration and will freeze your SSN if you don’t respond. They also won’t call or email you about a tax debt or a problem with your return because the IRS doesn’t initiate contact with taxpayers by phone or email—you will get a letter, or manyletters in the mail if the IRS needs to reach you.