Tax Filing: "Scams That Tax Payers Need to Avoid"
Studies have shown that most of the tax agencies manipulate the
tax laws and try to look for the loopholes in them for tax
deductions and benefits. Getting involved in tax scams can be
avoided if you understand the concepts on which some of the
fraud tax agencies work. Learn from: http://www.tax-definition.or
g
The Internal Revenue Service (IRS) has released a report on tax
scams and Tax-Definition.org ( http://www.tax-definition.or
g ) is happy to share them with tax filers to alert them to
any potential issues -
Tax Tips
for E-filers: http://www.tax-defi
nition.org/tax-tips
There have been many cases of tax scams that have been unveiled
by the Internal Revenue Services (IRS) in their annual listings
called the "Dirty Dozen". There are various tax agencies and
schemes that have been listed for making false claims to the
taxpayers.
Studies have shown that most of the tax agencies manipulate the
tax laws and try to look for the loopholes in them for tax
deductions and benefits. Getting involved in tax scams can be
avoided if you understand the concepts on which some of the
fraud tax agencies work.
Most of the credit counseling agencies that claim to help you in
fixing your credit ratings should be avoided. They generally aim
at charging high fees, or monthly charges that add to your debt.
The IRS Tax Exempt and Government Entities Division is making
audits on such agencies to avoid the exploitation that takes
place due to the debts of low-income customers. The agencies are
tax-exempt, yet they charge high fees for providing credit and
debt counseling to their customers.
There are many unscrupulous tax agencies that advise the tax
filers to move all their assets in a trust. According to them,
by putting your assets under a trust you will be able to reduce
your taxes, as the income that is subject to tax will become
lower. This will show deductions in your personal expenses due
to your reduced estate. You will be expected to pay lower gift
taxes.
However, most of the agencies that make suck promises fail to
deliver them. It is important for the taxpayer to hire a
qualified professional to help out in matters like entering a
trust. On the other hand, even the IRS is keeping an eye on such
agencies.
Some of the agencies want their customers to utilize a "claim of
right" doctrine. According to this, a taxpayer tries to file a
return with an aim to get a deduction that is equivalent to the
wages that he/she gets. Such a deduction is placed under is
interpreted wrongly and has no basis in law.
Therefore, a tax payer must gather all possible information
before falling in the trap of fraud tax agencies. The real
clause in the Internal Revenue Code is manipulated by such
agencies that propagate tax scams.
Filing a return is optional, wages cannot be considered as
income, and there are amendments in the tax codes that
discriminate against the tax payers are a few of the false
arguments that are advertised by the tax agencies. One should
not fall for any of these lousy statements. They have been
challenged and thrown out of the courts.
More and more of such scams have been unearthed that refute, or
manipulate different arguments and codes for tax exemption. A
tab on the identity thefts; on the telephone, Internet, and
frauds posing as IRS members; is essential.
If the IRS catches hold of such con agencies and people involved
with them; fine and imprisonment are inevitable. But, even the
tax payer should be aware of all the legalities involved in
filing their taxes to avoid taking help from outside.
Stay tuned for our second report on what tax payers / electronic
filers need to watch out for:
http://www.tax-definition.org/Define-File-a-return.html
You can also review Tax
definitions here: http:/
/www.tax-definition.org/Define-Form-1040.html