Tax Insights

Your Guide to State, Local, Federal, Estate + International Taxation

Ghost tax preparers

The IRS is warning taxpayers about potential ghost tax preparers. A ghost tax preparer is someone who prepares the return but does not sign it or even include information that is vital.

Don’t miss: What you need to give your CPA to prepare your 2019 tax return

From this point the ghost preparer is free to:

  • Create income to let their clients become eligible for tax credits
  • Claim fake deductions to boost their refund
  • Direct the refund into their personal account and not the taxpayers’
  • Require cash payments and not provide a receipt

They can get away with this since there is no signature, and it is assumed by the IRS that the return is self-prepared. It is imperative for taxpayers to recognize this scam since the amount of personal information that is involved with a tax return will strongly affect you.

Call and Wait is Annoying – You Just Want Answers from the IRS

A couple of tips given by the IRS and Arizona Department of Revenue (ADOR) are:

  • Ask questions before signing and filing
  • Make sure the tax preparer provides you with a copy of the return and all schedules
  • Use the “Choosing a Tax Professional” page from IRS.gov
  • Double check your routing and banking information on the return

ADOR recommends taxpayers with concerns about their tax preparer report it to the “Report Tax Fraud Hotline” at (602) 542-4023 or at https://azdor.gov/contact-us/report-tax-fraud. The IRS also states that you can report preparer misconduct by using Form 14157, Complaint: Tax Return Preparer.

Contact your friendly Henry+Horne tax rep with any of your tax questions and concerns. For more information on our services, check out our Accounting Services page.

Ryan Murphy