INDIANAPOLIS — The Indiana Department of Revenue continues to partner with the Internal Revenue Service to share the top tax filing season concerns referred to as the IRS Dirty Dozen tax scams for 2018.
The sixth scam in the 12-part series is inflated refund claims. Inflated refund claims are touted by scam artists claiming to be legitimate tax preparers to encourage unsuspecting victims to file taxes using their services. These scammers use flyers, advertisements, phony storefronts and presentations to lure victims by promising large tax refunds.
DOR is always looking for more ways to help raise customer awareness of the unfortunate means people use to take advantage of Hoosiers, said DOR Commissioner Adam Krupp in the release from the agency.
Scammers often target individuals who are not required to file, such as those with low income or seniors. They use deceiving practices to trick individuals into making claims for fake rebates, benefits or tax credits only to reap the benefits for themselves.
In addition, these con artists target individuals who are due a state and/or federal tax refund by promising a larger refund based on fake Social Security benefits and false claims for education credits or the Earned Income Tax Credit. Once they have a customer's information, they file a false return in the customers name and keep the refund.
To ensure a tax preparer is reputable, customers should review DORs tips for selecting a tax preparer in the Dirty Dozen news release "Dont Let Deceitful Tax Preparers Get You in Hot Water" at goo.gl/8Bi9BM.
One of the biggest clues customers should always keep in mind is that an honest tax preparer will provide their customers with a copy of the tax return they've prepared, said Commissioner Krupp.
Another way inflated refunds are claimed is through filing of phony W-2 or 1099 forms. These self-prepared or corrected forms report taxable income as zero, leading to large refunds. It is illegal to submit any falsified forms or attempt to submit a statement refuting wages and taxes reported by a third-party to the IRS. These false claims often result in perpetrators of this scam receiving significant penalties, imprisonment or both for tax dodging.
To view the first five of the IRS Dirty Dozen tax scams of 2018, visit www.in.gov/dor/6137.htm.