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 make $54,000 or less annually, persons with disabilities, and people who do not understand English well. 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
In California, anyone who prepares tax returns for a fee must be either an attorney, certified public accountant (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
If you owe money to the IRS or state taxing authority, be careful of people who will try to take advantage of you and charge you lots of money to “fix” your tax problem. While in some situations it may be helpful or even necessary to get professional help, there are many scammers who will just charge you for deals that you could have gotten on your own.
Before hiring someone to work out a deal for you with the IRS or other taxing authority, do your homework. Speak to others you trust who have used the consultant’s services. Check the internet to see if others have complained about the consultant. Don’t assume that because it is a law firm that they will do a good job.
Also, think about whether you can make a deal with the IRS 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 work out a deal for less than what you owe through an Offer in Compromise, or delay collection of your debt 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 show up every year, especially around tax season. The most common tax-related scams include:
- Fake IRS Phone Calls Demanding Money
Scammers will call you 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 make 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 look like they are 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 false tax returns in your name and steal your refunds. Scammers will usually file early in the tax season, before you get to it. You won’t learn that about the theft until you 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 call a person who owes taxes, they only do so after they have tried to contact you 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 it is from the IRS or the FTB. The IRS and FTB will not use email, text message, or social media as the first way of getting in touch with you 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, 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 firstname.lastname@example.org. 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”