The IRS Criminal Investigations Division reported a staggering $2.19 billion in tax fraud with an 89.4% conviction rate, according to its 2021 annual report.
Agency sources told News 6 refund fraud is one of the leading schemes under investigation by agents with the Internal Revenue Service Criminal Investigations unit.
Supervisory Special Agent Tara Reed, a 17-year C.I. veteran handling fraud cases in Washington, D.C and now Central Florida, said tax fraud has increased considerably in part because of so-called COVID crimes.
“We are talking about millions stolen every year,” Reed said. “The driving factor to get that increased refund is usually inflated deductions and false expenses.”
But those great deductions, according to Reed, usually land the taxpayer face-to-face with an IRS auditor.
“You need to ask the tax preparer what’s their background and education, what certifications do they have,” Reed told News 6.
One of the most infamous income tax fraud cases involved two Central Florida sisters, Petra Gomez and Jakeline Lumucso, who were indicted in a $25 million dollar tax fraud scheme.
According to court documents, the duo submitted more than 16,000 false tax returns built on records collected from their clients.
The tax returns were filed between January 2012 and June 2016 using five companies as fronts, including Universal Tax with the company slogan, “Get the maximum return.”
Reed told News 6 every tax season, the promise of a hefty tax refund is used as a lure to convince taxpayers to pay higher fees for a bigger refund.
The IRS offers these tips to make sure the person you hire to do your taxes is legitimate:
- Choose a tax preparer wisely. Look for a preparer who is available year-round.
- Ask your tax preparer for their IRS Preparer Tax Identification Number (PTIN). All paid preparers are required to have one.
- Don’t use a ghost preparer. They won’t sign a tax return they prepare for you.
- Don’t fall victim to tax preparers’ promises of large refunds. Taxpayers must pay their fair share of taxes.
- Don’t sign a blank tax return. Taxpayers are ultimately responsible for what appears on tax returns filed with the IRS.
- Make sure you receive your refund. Your refund should be deposited into your bank account, not your tax preparer’s.
- The IRS will not call you threatening legal action. If you receive a call like this, hang up.
- Don’t respond to text messages, emails or social media posts claiming to be the IRS. They may contain malware that could compromise your personal information.
- Don’t click links or open attachments in unsolicited emails or text messages about your tax return. These messages are fraudulent.
- Protect your personal and financial information. Never provide this information in response to unsolicited text messages, emails or social media posts claiming to be the IRS.
You can also protect your identity by signing up for an Identity Protection, or IP, PIN.
Before you prepare your taxes, that 6-digit number can be used instead of your social security number.
For more information, go to this link.
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