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The IRS warns about ghost tax preparers

The IRS wa
s about ghost tax preparers



 The Inte
al Revenue Service issued a wa
ing on Wednesday, February 17, 2021, to taxpayers to beware of "ghost" tax preparers who are unethical and do not sign tax retu
s for clients. The IRS has issued similar wa
ings in tax seasons in recent years as the phenomenon has grown and created the term "phantom preparer."


A ghost preparer prepares and prints the retu
, but asks the client to sign it and mail it to the IRS. For electronically filed retu
s, the ghost will prepare them, but will refuse to digitally sign the retu
as a paid preparer.


The IRS has increasingly been cracking down on unscrupulous tax preparers, although it has not yet been able to require a license from these tax preparers after a court struck down a registration program in 2013. However, the service still remains. They may require paid tax preparers to register with a Preparer Tax Identification Number that allows tracing of illegal activities or incompetent practices.


But ghost tax preparers avoid putting the PTIN on their retu
s to evade detection and instead have the taxpayer write that they prepared their taxes themselves. Some unscrupulous preparers open their tax preparation business only during tax season, prepare a series of fraudulent retu
s, and then disappear without a trace, just after the tax deadline has passed.


The IRS cautioned that phantom preparers may also require payment in cash only and not provide a receipt. They can also make up income to qualify their clients for tax credits and claim bogus deductions to increase the size of the tax refund. They can even direct refunds to their own bank account instead of the taxpayer´s account.


The IRS recommends that taxpayers visit the IRS Choosing a Tax Professional page on IRS.gov, which includes information on the credentials and qualifications for tax preparers. The IRS also offers an online directory of credentialed and qualified federal tax retu
preparers, such as CPAs, Enrolled Agents, and Preparers who have completed the IRS Voluntary Annual Tax Season Program.


The IRS wa
ed taxpayers to verify the bank account and routing number on their completed tax retu
for any direct deposit refunds and to beware of ghost preparers beware of ghost preparers who put their own bank account information on retu
s instead of the taxpayer´s account.


 


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Autor

Edic.: 164
Autor: Gustavo Nuñez
Date: 3/2021


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