Tax crimes Feed

The Internal Revenue Service and those who want Uncle Sam to go after tax evaders were elated when a bipartisan infrastructure bill included money for enhanced tax collection efforts. Proponents said the beefed-up proposal to close the Tax Gap could bring in an additional $100 billion over the next 10 years in owed but unpaid taxes. However, that funding option has been scuttled. "Well, one reason it's not part of the [infrastructure] proposal is that we did have [Republican] pushback," said Sen. Rob Portman (R-Ohio) during an appearance today on CNN's "State of the Union" program. But there's still hope... Read more →


The Internal Revenue Service has wrapped up its 2021 version of the Dirty Dozen Tax Scams. In announcing the cons by category, the agency was able to elaborate more on each trick on the list. In case you missed the posts earlier this week, here are the ol' blog's posts on each of them: Pandemic related scams, aka Part 1, which focuses on attempts steal COVID-19 Economic Impact Payments (EIPs) and other tax-related coronavirus relief distributed by the IRS, from Monday, June 28; Personal information cons, or Part 2, with a look at phishing, its cousin voice phishing or vishing,... Read more →


What's the result when the worst things happen? Too often, it's terrible people taking advantage of good people. This occurs with alarming regularity in the tax world following tragedies and disasters. Con artists use horrible events to convince compassionate individuals to donate to groups that will help out the victims. What really happens all too often is the caring donors become victims, too. Fake charities are just one type of scam in today's third installment of the IRS' Dirty Dozen for 2021. This category of tax ruses in which dishonest people trick others into doing something illegal often includes fraudulent... Read more →


The COVID-19 pandemic presented new opportunities for crooks, as noted in yesterday's post on the first group of 2021's Dirty Dozen Tax Scams. Today, however, we're back with the golden oldies, as in trying to steal your gold. And your identity. These Personal Information Cons use a variety of techniques that have been around for years. There's phishing, its cousin voice phishing or vishing, Internal Revenue Service impersonators, social media trolling and tricks, and ransomware. Regardless of which illegal method is used, the goal is the same. Criminals try to get as much of your personal information as possible, including... Read more →


It's Dirty Dozen Week at the Internal Revenue Service. That's right, a week of examining the 12 most common and/or worst tax scams that have cropped up over the last year. I've been blogging about the annual IRS scam list for as long as Don't Mess With Taxes has been around. Sadly, some of the scams that I noted in my first list post back in the spring of 2006 — phishing for taxpayer identity details, fake charities, unscrupulous tax preparers — tend to show up year after year. You can see the repeat offenders in the 2019 and 2020... Read more →


Here's some good news to kick off you weekend. Most U.S. taxpayers say cheating on taxes is wrong. Of the taxpayers who participated in the Internal Revenue Service's 2020 Comprehensive Taxpayer Attitude Survey (CTAS), 87 percent said it is not at all acceptable to cheat on their income taxes. Even more, 94 percent, believe it is a civic duty to pay their fair share of taxes. Another 91 percent said everyone who cheats on their taxes should be held accountable. The combination online-telephone survey was conducted from Aug. 24, 2020, through Sept. 24, 2020, by Pacific Consulting Group (PCG). PCG... Read more →


Photo of John McAfee shared by his wife earlier this year as part of a Twitter post arguing for his release from a Spanish prison. Last week, millionaire software developer John McAfee was in a Spanish court arguing that he shouldn't be extradited to the United States to face tax evasion charges. Today, MacAfee was found dead in his cell at a Barcelona-area jail. There's no official word on the cause of death. News reports, however, say a preliminary investigation found no signs of foul play. Early indications are that McAfee hanged himself. Hours before the discovery, Spain's National Court... Read more →


While one accused wealthy tax cheat awaits a Spanish court's decision on whether he'll be returned to the United States to face charges, U.S. lawmakers look for ways to snare more rich tax evaders. Or at least get more from them up front. Rather than letting the wealthy have more money to burn, efforts are underway in Washington, D.C., to make it easier to catch rich tax scofflaws, as well as to simply tax them even more. Billionaires who've managed to use tax laws to avoid paying any tax have been getting even more attention lately. Some wealthy people, however,... Read more →


The Biden Administration's proposal to up the Internal Revenue Service budget so it could go after more rich tax cheats got a lot of attention. But the White House also wants to cut down on some audits. That, according to the president's American Families Plan, can be accomplished by giving the IRS more oversight of unregulated tax preparers. The audit/tax pro regulation connection is noted in a White House fact sheet hyping the proposal: These Tax returns prepared by certain types of preparers have high error rates. These preparers charge taxpayers large fees while exposing them to costly audits. As... Read more →


One of the many reasons that people hate taxes is that after the hassle of filing, then comes the fear that a Form 1040 mistake will mean an audit. The sort-of good news for taxpayers is that the Internal Revenue Service hasn't been auditing as many people in recent years. The agency has had other things to worry about, like doing its myriad jobs with fewer staff and less money. Then there's COVID-19, with added pandemic payments that the IRS is tasked with distributing. Things could be changing, though. More people are getting vaccinated, meaning the end of the coronavirus... Read more →


Rather than heavy equipment, the IRS needs legislative and fiscal help to close its $1 trillion Tax Gap. If you've thought the $441 million figure that the Internal Revenue Service has for years cited as the Tax Gap is too low, you are not alone. None other than the IRS commissioner agrees that there is more tax money that's owed than the agency has been able to collect. A whole lot more. At an April 13 hearing before the Senate Finance Committee, IRS Commissioner Charles Rettig estimated that the actual Tax Gap could be as much as $1 trillion. That's... Read more →


Bernie Madoff leaving a court hearing in 2009. Bernard "Bernie" Lawrence Madoff died on April 14 in a federal prison medical facility where he was being treated for terminal kidney disease. The 82-year-old had been in jail since 2009 for orchestrating the world's largest Ponzi scheme. Madoff pleaded guilty on March 12, 2009, to 11 federal crimes, including operating the financial fraud that bilked as many as 37,000 people in 136 countries over two decades. He was sentenced three months later to the maximum 150 years behind bars and ordered to pay restitution of $170 billion. At the time of... Read more →


While the Internal Revenue Service is working on recalculating taxes paid on unemployment benefits by early filers, other taxpayers are dealing with potential tax bills on money they didn't get. They are victims of unemployment insurance fraud. And their numbers increased last year as millions of people filed for the jobless assistance in the wake of the COVID-19 pandemic. To help people dealing with unemployment identity theft, the Department of Labor (DoL) has launched a new website. Alerted by mail: Many don't learn that unemployment benefits have been fraudulently collected in their names until they receive something in the mail.... Read more →


Ah, college days. Studying, working between and after classes and now trying to avoid becoming a tax scam victim. (Photo by Tim Gouw via Unsplash) Many college students shoehorn jobs into their study schedules to help pay for their continuing educations. In addition to pocketing that cash throughout the year, many of these young workers also look forward at filing time to tax refunds from their jobs. So do crooks. The Internal Revenue Service today warned of an ongoing phishing scam in which the perpetrators are targeting education institutions, including students and staff with email addresses ending in the .edu... Read more →


New COVID-19 laws have been a lifeline for many individuals and businesses as the United States. They've also created new opportunities for crooks. The Internal Revenue Service, specifically its Criminal Investigation (CI) Division, is well aware of the increased tax-related coronavirus crimes. To mark the one-year anniversary of the Coronavirus Aid, Relief and Economic Security (CARES) Act, CI officials today discussed the unit's success in combatting fraud related to the Economic Impact Payments, Paycheck Protection Program (PPP) loans and claims of the Employee Retention Credit. The CI's commemoration is particularly timely. It comes just one day after a Texas man... Read more →


The third round of coronavirus economic impact payments are on their way. So are con artists trying to convince financially strapped folks that there are easier ways to get the government payments of up to $1,400 per person. Don't fall for the lies. Some of the just-approved $1,400 COVID-19 relief payments will be delivered by local postal carriers. Others will get their coronavirus cash by direct deposit or Treasury-authorized debit cards. Be on the lookout for the payments, as well as crooks trying to steal them and your identity. The latest COVID-19 economic relief plan, officially known as the American... Read more →


Today's unemployment numbers offered a hopeful sign for the U.S. economy struggling with the COVID-19 pandemic. The news, however, is not so good for many who in 2020 got these out-of-work benefits. Many recipients of the emergency financial assistance are surprised to learn that unemployment benefits are taxable. Others are even more surprised at the amounts on their Form 1099-G. This is the document sent to taxpayers and copied to the Internal Revenue Service. While social media messages and comments on the ol' blog are purely anecdotal, it seems that quite a few folks think their 2020 unemployment benefits have... Read more →


Tax preparers nationwide already are working on clients' returns. Crooks also are working to steal info on and from those tax professionals. The Internal Revenue Service won't start accepting and processing 2020 tax returns until Feb. 12. Tax professionals, however, have been working of their clients returns since the new year arrived. That means tax criminals also doing their so-called jobs. The Internal Revenue Service, state tax agencies and tax industry today announced that there's a new scam email being sent to tax professionals. The phishing message impersonates the IRS and attempts to steal Electronic Filing Identification Numbers (EFINs). While... Read more →


If you want more security for your tax return, the Internal Revenue Service has a deal for you. Every taxpayer now can apply for an Identity Protection Personal Identity Number, or IP PIN. An IP PIN lets the IRS verify that it is indeed you who has filed your tax return. Once you have the six-digit code, the agency won't accept an electronically filed return in your name without it. If a paper return shows up without the IP PIN, it will get added IRS scrutiny. "This is a way to, in essence, lock your tax account, and the IP... Read more →


Remember when you were a kid and you told mom about the latest misdeed committed by your little brother. Oh, wait. Maybe that's just me reminiscing. And as I recall, while my mother was glad to know when my younger sibling did or was about to do something (I was a proactive big sister!) that was dangerous (he was the more adventurous one), she emphasized that continually tattling about everything Ben did that annoyed me was not productive. And I never got rewarded for my snitching observations. My mother would not have made a very good Internal Revenue Service Whistleblower... Read more →