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Estate Planning: Avoiding Tax Scams Thumbnail

Estate Planning: Avoiding Tax Scams

Tax planning is a year-round process, not just something that happens in the weeks leading up to April 15. It's a wise move to keep your tax planning efficient and educate yourself about potential tax scams.

Avoiding tax scams

Year after year, criminals try to scam certain taxpayers. And year after year, certain taxpayers resort to schemes in an effort to put one over on the Internal Revenue Service (IRS). These cons occur year-round, not just during tax season. In response to their frequency, the IRS has listed the 12 biggest offenses—scams that you should recognize and schemes that warrant penalties and/or punishment.


If you get an unsolicited email claiming to be from the IRS, it is a scam. The IRS never reaches out via email, regardless of the situation. If such an email lands in your inbox, forward it to phishing@irs.gov. You should also be careful when sending personal information, including payroll or other financial information, via an email or website.

Phone scams

Each year, criminals call taxpayers and allege that said taxpayers owe money to the IRS. Visual tricks can lend authenticity to the ruse. For example, the caller ID may show a toll-free number. The caller may mention a phony IRS employee badge number. New spins are constantly emerging, including threats of arrest and even deportation.

Identity theft

The IRS warns that identity theft is a constant concern—and not just online. Thieves can steal your mail or rifle through your trash. While the IRS has made headway in terms of identifying such scams when related to tax returns and plays an active role in identifying lawbreakers, the best defense is to be cautious with your identity and information.

Return preparer fraud

Among the many honest professionals, there are also some con artists out there who aim to rip off personal information and grab phantom refunds, so be careful when selecting who prepares your tax returns.

Fake charities

Some taxpayers claim that they are gathering funds for hurricane victims, an overseas relief effort, an outreach ministry, and so on. Be on the lookout for organizations that use phony names to appear as legitimate charities. A specious charity may ask you for cash donations and/or your Social Security number and banking information before offering a receipt.

Inflated refund claims

In this scenario, the scammers do prepare and file 1040s, but they charge big fees up front or claim an exorbitant portion of your refund. The IRS specifically warns against signing a blank return and trusting preparers who charge based on the amount of your tax refund.

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.

This is not a recommendation and is not intended to be taken as a recommendation. This material was prepared for general distribution and is not directed to a specific individual.

LPWM LLC does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisers.