CHARLOTTE — The Internal Revenue Service’s Criminal Investigation Division reminded taxpayers today to file accurate tax returns and choose a tax preparer wisely. The nation’s tax season starts on Friday, Feb. 12, 2021 when the agency begins accepting and processing 2020 tax year returns.
U.S. persons are subject to tax on worldwide income from all sources. Most taxpayers meet this obligation by reporting all taxable income and paying taxes according to the law. However, those who willfully hide income should know that the IRS works across
its divisions to ensure the highest possible tax compliance. Taxpayers found to be committing fraud may be subject to penalties including payment of taxes owed plus interest, fines and jail time.
“IRS Criminal Investigation is committed to investigating tax fraud and other financial crimes, and making sure tax cheats are brought to justice,” stated Matthew D. Line, Special Agent in Charge of the IRS Criminal Investigation division in North Carolina, South Carolina and Tennessee. “As the tax filing season begins, taxpayers should take whatever steps necessary to ensure the information reported on their tax returns is complete and accurate. There are always scammers looking for opportunities to take advantage. Whether it is tax or COVID related schemes, remember if it seems too good to be true it probably is.”
Tax return preparers are vital to the U.S. tax system. As of tax year 2018, 55 percent of taxpayers used a paid preparer. Although most preparers provide honest and professional services, there is a small number of dishonest preparers who set up shop during filing season to steal money, personal and financial information from clients. Taxpayers can avoid falling victim to unscrupulous preparers by following important steps.
Tips when choosing a tax preparer:
- Look for a preparer who is available year-round in case questions arise after the filing season.
- Ask if the preparer has an IRS Preparer Tax Identification Number, which is required for paid preparers.
- Inquire about the preparer’s credentials and check their qualifications.
- Ask about service fees. Avoid preparers who base fees on a percentage of their client’s refund or claim to offer a bigger refund than their competition.
- Never sign a blank or incomplete return and review it before signing. Refunds should go directly to the taxpayer, not the preparer.
For more tips on choosing a tax professional or to file a complaint against one, visit IRS.gov. Taxpayers who suspect tax violations by a person or business, may report it to the IRS using Form 3949A, Information Referral.
The IRS Criminal Investigation Charlotte Field Office is committed to protecting North Carolina taxpayers from unscrupulous tax preparers and others intent on cheating the U.S. tax system. Here are some examples of some of the most egregious criminals that have been recently investigated and brought to justice:
- October 2020 – A Greensboro business owner was sentenced to 42 months in prison for failing to pay employment taxes.
- November 2020 – A Lexington couple pleaded guilty to tax evasion and are awaiting sentencing.
- December 2020 – Two Durham tax return preparers pleaded guilty to conspiring to defraud the U.S. Government by preparing false tax returns, resulting in a tax loss of over $1 million.
- December 2020 – Two tax professions pleaded guilty in Asheville to promoting a syndicated conservation easement tax scheme involving more than $1.2 billion in fraudulent charitable contribution deductions.
