We're a few months removed from income tax season and its usually around this time of the year that we start to hear stories of folks trying to find ways to cheat the IRS and unsuspecting tax payers out of money through various scams. The IRS has a list of scams called "The Dirty Dozen Tax Scams" and a Longview tax service is accused of engaging in one of those scams and they are taking them to court for it.

The IRS filed a lawsuit against Elite Tax Solutions And Its Proprietors.

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According to a press release from the Justice Department, The United States filed a civil injunction suit to permanently bar Jason Elias Briley; the owner of Elite Tax Solutions and seven other tax preparers: Roxann Ladawn Johnson fka Roxann Ladawn Ellis; Alexander McKenzie; Courtney Jones; Derek Brooks; Deanna McKenzie; Erbia Lewis and Patrick McKenzie from preparing federal income tax returns for others. The lawsuit also requests that the court require the defendants to disgorge or pay back the fees they obtained by preparing false and fraudulent tax returns.

The Feds Are Alleging That The Service Engaged In Return Preparer Fraud

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According to the feds, these tax return preparers prepared more than 1,300 returns in 2021 and over 3,100 returns in 2022 and that Briley and the others allegedly prepared returns that falsely claimed over $53 million in credits and refunds intended to provide COVID-19 related relief for self-employed individuals.

Tax Scams You Need To Look Out For

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The IRS "Dirty Dozen Tax Scams" that you need to look out for according to their website are:

  • FAKE CHARITIES: Criminals frequently exploit natural disasters and other situations such as the current COVID-19 pandemic by setting up fake charities to steal from well-intentioned people trying to help in times of need.
  • Threatening Impersonator Phone Calls:  A common one remains bogus threatening phone calls from a criminal claiming to be with the IRS. The scammer attempts to instill fear and urgency in the potential victim. In fact, the IRS will never threaten a taxpayer or surprise him or her with a demand for immediate payment.
  • Social Media Scams: The basic element of social media scams is convincing a potential victim that he or she is dealing with a person close to them that they trust via email, text or social media messaging.

 

  • EIP or Refund Theft: Much of this stems from identity theft whereby criminals file false tax returns or supply other bogus information to the IRS to divert refunds to wrong addresses or bank accounts.
  • Senior Fraud: Anecdotal evidence across professional services indicates that elder fraud goes down substantially when the service provider knows a trusted friend or family member is taking an interest in the senior's affairs.
  • Scams targeting non-English speakers: A common one remains the IRS impersonation scam where a taxpayer receives a telephone call threatening jail time, deportation or revocation of a driver's license from someone claiming to be with the IRS. Taxpayers who are recent immigrants often are the most vulnerable and should ignore these threats and not engage the scammers.

 

  • Unscrupulous Return Preparers: Taxpayers should avoid so-called "ghost" preparers who expose their clients to potentially serious filing mistakes as well as possible tax fraud and risk of losing their refunds.
  • Offer in Compromise Mills: Taxpayers need to wary of misleading tax debt resolution companies that can exaggerate chances to settle tax debts for "pennies on the dollar" through an Offer in Compromise (OIC). These scams are commonly called OIC "mills," which cast a wide net for taxpayers, charge them pricey fees and churn out applications for a program they're unlikely to qualify for.
  • Fake Payments with Repayment Demands: A con artist steals or obtains a taxpayer's personal data including Social Security number or Individual Taxpayer Identification Number (ITIN) and bank account information. The scammer files a bogus tax return and has the refund deposited into the taxpayer's checking or savings account. Once the direct deposit hits the taxpayer's bank account, the fraudster places a call to them, posing as an IRS employee. The taxpayer is told that there's been an error and that the IRS needs the money returned immediately or penalties and interest will result. The taxpayer is told to buy specific gift cards for the amount of the refund.

 

  • Payroll and HR Scams: Currently, two of the most common types of these scams are the gift card scam and the direct deposit scam. In the gift card scam, a compromised email account is often used to send a request to purchase gift cards in various denominations. In the direct deposit scheme, the fraudster may have access to the victim's email account (also known as an email account compromise or "EAC"). They may also impersonate the potential victim to have the organization change the employee's direct deposit information to reroute their deposit to an account the fraudster controls.
  • Ransomware: Ransomware is malware targeting human and technical weaknesses to infect a potential victim's computer, network or server. Malware is a form of invasive software that is often frequently inadvertently downloaded by the user. Once downloaded, it tracks keystrokes and other computer activity. Once infected, ransomware looks for and locks critical or sensitive data with its own encryption. In some cases, entire computer networks can be adversely impacted.

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