Better Business Bureau: Beware of common tax scams

Published 9:31 am Thursday, January 17, 2019

SOUTHWEST MICHIGAN — The new year brings with it the start of tax season. Even with the government shutdown, the IRS has said it will begin processing returns on Jan. 28. The filing deadline to submit 2018 tax returns is Monday, April 15. Even with the convenience of tax return software, more than half of returns submitted to the IRS last year were prepared by someone other than the taxpayer.

“This is the time of year we see an increase in tax fraud targeting consumers,” said Phil Catlett, president of the Better Business Bureau serving western Michigan. “Taxpayers could lose a lot of money if they are not careful about who they hire to do their taxes.”

Now, the BBB is offering tips to help southwest Michigan residents avoid common tax scams and find the right tax preparer.

Here are some steps to take, according to BBB representatives.

• Do your research — Before hiring someone, check their background and reputation. Research the preparer online and at bbb.org. Meet with them and make sure you are comfortable with the person doing taxes.

• Ask about their fees ahead of time — Know how much they charge for their services before hiring them. This includes any fees for e-Filing state, federal and local returns.

• If it sounds too good to be true, it probably is — Be wary of tax services who make a promise of a big refund, or asks for a percentage of the return for a fee.

• Where are they after April 15th? — Always be sure to ask the tax service how you can contact them after tax season ends, especially if they are at a temporary location.

• Be prepared — When it is time to prepare returns make sure you have all of your tax forms and receipts ready. For more information visit irs.gov or michigan.gov/taxes.

• Read before singing — Go over returns thoroughly before submitting it to the government. Read each page and never sign a blank return. Ask questions about anything difficult to understand or any numbers that don’t make sense. In most cases the preparer must also sign the return. Remember, the sender is responsible for the accuracy of your return.

• Do taxes early — One common fraud during tax season involves identity theft. Scammers try to submit a return in a victim’s name and have their refund come to them. People can avoid this by beating scammers to it and submitting tax returns early.

• Use direct deposit — Waiting for a check in the mail can be frustrating. The fastest way to receive tax refunds is by attaching bank account and routing information to returns. Be sure to double check for mistakes, including banking and routing numbers. Mistakes will delay refunds.