Consumer Update: Tax Preparation Fraud

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• Signs Your Tax Preparer May Be Scamming You

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  Tax returns will be filed in the next few months and some may be filed by scammers looking to rip you off. So how do you know if your tax preparer is legitimate?

  Use someone with an established business and good reputation, the combination is the best defense against scams, says Sandy Chalmers, Wisconsin Department of Agriculture, Trade and Consumer Protection assistant deputy secretary.

  “It may be a good idea, if you’re doing this for the first time, to get a reference from somebody,” she said. “Get their qualifications and credentials. If you need a CPA, make sure the preparer has that accreditation.”

  Chalmers said there are a number of warning signs the person preparing your taxes isn’t on the up and up:

  • Does the preparer ask you to sign a blank tax form?
  • Does the person ask you to have your refund deposited into their account rather than yours?
  • Does the person want you to give them permission to file your return before you reviewed it?

  “These are obviously red flags,” she said.

  Chalmers warned taxpayers to also be careful of short-term loans. She recalled a recent scam in the Milwaukee area where the collected loan information was then used to file fake tax returns.

  “What happened in that case was people would come in for a quick holiday loan and the crooks would use that information – which included a social security number, name, address – to file a tax return without the person even knowing,” Chalmers recounted.

  Any refunds would then go to the scammer.

  She said there are a lot of qualified, honest tax preparers, the key is to ask questions before handing over any information.Anyone suspecting fraud should file a complaint with DATCP.