CLEARWATER, Florida - 'Tis the season for taxes and tax fraud. The Better Business Bureau of West Florida is warning tax preparers about those eager to get their hands on your money. But there are a few simple ways to keep your money and stay out of trouble with the IRS.
"[Tax preparer fraud] occurs when the tax preparer improperly inflates the refunds on people's tax returns," says John Zajac with the BBB of West Florida.
If you're the victim, you'll be on the hook to the IRS, paying not just back taxes, but also interest and penalties.
That's why the Better Business Bureau is sending out a warning. Zajack says to beware of ads that sell you high refunds with low documentation.
"Often these companies offer a loan in advance of receiving your tax refund. So what happens is, they over-inflate the tax refund that's owed to the person and the company makes more money, passes more money on to you."
Here's what the BBB says you can do to avoid the scam:
- Look for credentials: Seek out an enrolled agent, certified public accountant, or a tax attorney.
- Get a firm estimate in writing.
- Don't fall for the promise of a big refund: Be wary of tax preparers who promise larger refunds than the competition.
- Protect your identity: The IRS will never send you an email. If you have a question, visit IRS.gov and give them a call.
- Do your research: Check out the company before you work with them.
"Use your common sense here. If you have your documentation and you submit it, your taxes should be the same from one business to the other," says Zajac.
He adds your best bet is to check out any company before you have them do your taxes, because you are ultimately responsible for filing your taxes properly.
Visit http://westflorida.bbb.org/ to check out a company.