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The Worst Tax Scams

Each Year, The Internal Revenue Service releases a list of the worst tax scams.  These scams peak at tax season but happen year round.  Here's a roundup of some of the favorites by fraudsters.

Identity theft, phone scams and "phishing" are listed 1,2, & 3.  ID theft, of course, is when someone uses your stolen Social Security number to file a tax return claiming a fraudulent refund.  Phone scams are those scary, send us money right now or go to jail calls.  Phishing is usually done by email.  The sender is seeking personal and financial information.

Fake charities abound also.  They often use names similar to trusted organizations, even setting up fake websites.  They are out to take your hard earned cash and prey upon your generosity.  You can go to IRS.Gov to see if they're legit.

Taxpayers are guilty of tax scamming also.  They have been known to falsely claim deductions, under report income, use multilayer companies to try and conceal who owns income.  The earned income tax credit has been abused, as taxpayers actually claim higher income and /or dependents they are not entitled to claim, to get a larger refund.

The IRS is on the lookout for fraud constantly.  Beware, be smart and if you have any questions, give us a call.

Suspicious Email from the IRS

Have you ever received a suspicious email from the Internal Revenue Service?  Most of us have.  You know it is phony by reviewing the spelling and appearance.  We received just such an email at our Law Firm.  I wondered how these scammers could be so bold as to use the actual IRS logo on their phishing expedition.

After careful review, I see they did not use the actual IRS logo.  The Logo on their email had one difference.  THE BEAK OF THE EAGLE WAS FILLED IN !!!!!!!!   Needless to say, I forwarded this to phishing@irs.gov.  I am sorry to say, my email was promptly rejected as junk mail.

Tax Season

Tax Season is upon us. Time to start gathering your tax documents and information, for filing.

New Medicare Cards are Coming Soon!

Starting April 1, 2018, the government will be issuing new Medicare cards that do not use your social security number as your ID number. Instead, they will have a computer-generated number assigned to you. It will no longer show your gender or require a signature. The idea is to make it harder for the scammers to steal your social security number along with your identity.

You will need to start using your new Medicare ID by December 31, 2019. Your Current card will be good until then.

QTIP Trusts

A Qualified Terminable Interest Property (QTIP) Trust is a trust that enables the grantor to look after his or her current spouse and ensure that the assets from the trust are then passed on to beneficiaries of the grantor’s choice, such as children from a grantor’s previous marriage. In addition to providing the living spouse with a source of funds, a QTIP Trust also limits death and gift tax burdens on the surviving spouse. QTIP Trusts also prevent assets from transferring to a surviving spouse’s new spouse, should they choose to remarry.

End of Year Donations and Write Offs

Here at year end many people are preparing to make charitable donations. As long as the checks are in the mail by December 31st, 2016, you will be able to write off the donation on your 2016 tax return. If you are making your donation using a bank-issued credit card, you can claim the write-off in the year you charged the expense, even if you pay the bill in the next year. Retailer-issued credit cards must claim the write-off in the year the bill is paid.