Tax Preparation Resources & Tax Scams
You may be eligible for free tax help!
The Volunteer Income Tax Assistance (VITA) program provides free tax help to people who generally make $54,000 or less annually, persons with disabilities, and people with limited English proficiency. The Tax Counseling for the Elderly (TCE) program offers free tax help for all taxpayers, particularly those over 60, specializing in questions about pensions and retirement-related issues. You can find out more about these programs and information on how to find someone to help you at the IRS website.
Finding a Tax Preparer
When looking for a tax preparer, ask your friends and neighbors for recommendations. In California, anyone who prepares tax returns for a fee must be either an attorney, certified public account (CPA), an IRS-enrolled agent, or registered with the state as a tax preparer. More information is available at the California Tax Education Council’s website. To confirm whether your tax preparer is registered with the IRS, check here. The IRS also offers tips on finding a tax preparer.
Complaints against your Tax Preparer
To make a complaint with the IRS about a tax preparer, you can do so here.
Tax Resolution Scams
Some people find themselves owing money to the IRS or state taxing authority. This can be scary and, unfortunately, there are those who might seek to take advantage of this situation by charging money, often a lot of money, to resolve problems with the tax man. While you may find professional assistance helpful or even necessary, many scam artists will not get you any relief you couldn’t get on your own. Even the fact that the offers are coming from a law firm is no guarantee that they are legitimate.
Before hiring someone to negotiate on your behalf with the IRS or other taxing authority, do your homework. Speak to others you trust who have used the consultant’s services. Check on the internet to see if others have complained about the entity or person.
Also consider whether you can resolve your issues with the tax authority on your own. The IRS offers advice on payment plans and installment agreements and an online application for eligible taxpayers seeking an installment agreement. You may also be able to resolve your debt with the IRS for less than the total outstanding through an Offer in Compromise. You might also be able to delay collection activities by the IRS by having your account declared Currently Not Collectable. Information on Installment Agreements with the California Franchise Tax Board is available here and information about FTB’s Offers in Compromise can be found here.
Tax Fraud Scams
Tax-related scams take on various forms and make a resurgence every year, especially around tax season. The most common tax-related scams include:
- Fake IRS Phone Calls Demanding Money
Scammers will call you directly claiming that they are from the Internal Revenue Service (IRS) or the California Franchise Tax Board (FTB) and say that you owe them money. The scammer will harass you and use high pressure tactics claiming that you will be arrested, deported, or will lose your driver’s license if you don’t pay right now. They will require that you wire the money to them or pay through a prepaid debit card. Sometimes the scammer will even know your Social Security number or fake the caller ID so that it looks like they are calling from the IRS or FTB. They may even make follow-up calls that look like they are from the police or DMV.
- Fake IRS Emails
Scammers will send out “phishing” emails that appear to be from the IRS or FTB and claim that you either owe money or are due a refund. They will include links to official-looking web sites and ask for either money outright or personal information that will allow them to steal your identity.
- Stolen Refunds
Identity thieves will use stolen personal information to file fraudulent tax returns in your name and run off with your refunds. Scammers will typically file early in the tax season, beating you to the punch. The first time you learn that your identity has been stolen will be when you legitimately try to file your taxes.
How to Protect Yourself from Tax Fraud Scams
Here are some tips to protect yourself from tax-related scams.
- Hang up the phone! While in some cases the IRS or FTB may contact a delinquent tax payer by phone, they do so only after they have attempted contact by mail. And they do not threaten jail time or seek payment over the phone or through a wire transfer. Do not make any payments. If you have any doubts, contact the agency directly by looking up their information online. More information is available from the IRS and FTB.
- Do NOT open the email. Never open an email or text message that says its from the IRS or the FTB. The IRS and FTB do not initiate contact with taxpayers through email, text message, or social media to request personal or financial information or to send notice regarding audits or refunds. Replying to the email, opening attachments, or clicking on links may enable scammers to collect your personal information or infect your computer with viruses or other malware.
- Use a strong password. When preparing your tax return for electronic filing, be sure to use a unique strong password for your online filing accounts. A strong password is eight or more characters, including letters, numbers, and symbols. Use a unique password for each of your tax filing accounts.
- Think beyond the password. For greater security, you can get an Identity Protection PIN (IP PIN) for your e-filing account with the IRS. A new PIN is provided each year by the IRS. See the Helpful Resources section for more information.
- Use two-step authentication. Check on the availability of two-step authentication to protect your tax filing accounts (and other online accounts containing sensitive information, such as your email and social media accounts). Two-step authentication offers stronger protection than just a password and username. The process (also called login approval or multi-factor authentication) adds a second factor, such as a one-time use code that is sent to you by email, phone or text. You enter that code, along with your username and password, to get access to your account.
- Report the number and email. If you receive a phone call or email impersonating the IRS, report it to the Treasury Inspector General for Tax Administration (TIGTA). Also send any phishing emails to email@example.com. If you receive a phone call or email impersonating the FTB, report it here.
What to Do If You’re a Victim
Here is what to do if you have been a victim of a tax-related scam.
- Report the scam and your losses to the IRS and/or the FTB.
- If you are a victim of identity theft, see the identity theft links in the Helpful Resources section below.
For more information about tax fraud scams, check out the following webpages:
- Internal Revenue Services’ page titled, “Tax scams / Consumer Alerts”
- Internal Revenue Services’ page titled, “Identity Protection: Prevention, Detection and Victim Assistance”
- Internal Revenue Services’ page titled, “Taxpayer Guide to Identity Theft”
- Internal Revenue Services’ page titled, “Get An Identity Protection PIN (IP PIN)”
- California Franchise Tax Board’s page titled, “Report Scams, Identity Theft, & Tax Fraud”
- Federal Trade Commission’s page titled, “Another tax scam: IRS imposters”
- Federal Trade Commission’s page titled,“Tax-Related Identity Theft”
- Attorney General’s page titled,“Identity Theft”