DOR Teams Up with Office of Consumer Affairs to Protect Taxpayers from Filing Season Scams
Choosing reputable preparers to file returns is key to security
(Boston - March 18, 2014) - Massachusetts Revenue Commissioner Amy Pitter today joined Consumer Affairs Undersecretary Barbara Anthony to warn Massachusetts taxpayers to be careful of whom they chose to prepare their state and federal income taxes, and issued a checklist to help guard against identity theft and other tax filing season scams.
“The beginning of the filing season is when we see the biggest push by criminals who prey on taxpayers to steal their identity and file fraudulent returns in an attempt to pocket millions of dollars in refunds,” said Commissioner Pitter.
Undersecretary Anthony noted that “This time of year is ripe for unscrupulous preparers who promise maximum refunds to low income, immigrant and senior taxpayers and who charge inflated fees or a percentage of the refund and leave these taxpayers on the hook for illegal claims.”
At Greater Boston Legal Services, which offers low income taxpayer assistance, Luz Arevalo said they see poor families, often immigrants who can’t speak English, victimized by so-called preparers who make up information or inflate income so their clients can qualify for the earned income tax credit or the senior property tax credit.
“When our clients fall prey to these preparers, they pay a high price, not just with lost refunds, potential penalties and interest, but in mental distress and anguish,” said Arevalo. This effort to educate the most vulnerable taxpayers is a worthy investment.”
The best protection for taxpayers who need help in preparing a state or federal tax return is to know who is preparing their taxes by asking questions:
- Are they qualified?
Paid tax preparers are required to have a preparer tax ID. Ask to see it along with membership in any professional organizations. Check to see if the preparer has a questionable history or any disciplinary actions with the Better Business Bureau, the Massachusetts Board of Accountancy for Certified Public Accountants, or the Massachusetts Bar Association.
- Do they charge service fees?
Avoid those who charge a percentage of your refund or who claim they can obtain larger refunds than other preparers. Also, always make sure any refund due is sent to you or deposited into an account in your name. Under no circumstances should all or part of your refund be directly deposited into a preparer’s bank account.
- Do they e-file returns?
Paid preparers who file more than 10 returns to the IRS or DOR must file returns electronically. It is the safest method for processing returns and the quickest way to get a refund. Whether filing electronically or by paper, never sign a blank return. Before you sign your return, review it and ask questions. Make sure you understand everything and that you are comfortable with the accuracy of the return before you sign it.
- Do they want to see your records and receipts?
Good preparers will ask for your children’s social security numbers or your W-2 income form to determine if you qualify for the Earned Income Tax Credit (EITC). The EITC is a refundable tax credit intended to help low- and moderate-income workers hold onto more of their income. Taxpayers can check their eligibility by visiting the IRS Credit & Deductions page at www.irs.gov.
Taxpayers can find a printable checklist on choosing a reputable tax preparer on the Department’s website, as well as a related video series on YouTube. To report any tax preparation scams or questionable preparers, please contact the Office of Consumer Affairs hotline at 617-973-8787 or toll free in Massachusetts at 888-283-3757.
Taxpayers can also take advantage of free tax preparation services such as DOR’s online WebFile for Income. Volunteers trained by the IRS and DOR also staff over 300 libraries, senior centers and other sites in Massachusetts to help you prepare your taxes and safely transmit your return to the IRS and DOR based on income and age eligibility. To find the site closest to you visit MA Cash Back.