 Internal Revenue Service IRS tax news, dirty dozen. IRS warns individuals to stay clear of shady tax preparers, offers tips on carefully choosing tax professionals. It is definitely good advice to stay away from shady tax preparers. Unless of course it's a really hot day, in which case some shade might be well appreciated. Although, although even then, finding a tax preparer with some A, C would even be better. I mean, considering this is the dirty dozen list, I feel like they would have replaced the term shady with shit. I mean, you know the A with, you know what I mean? Because, because although the shade can be used to hide dirt, the shade itself is not the actual dirt, right? It's just like hiding the dirt. The dirt is the dirt. I mean, that's, that's like blaming the White House for the dirty executive orders coming out of it, you know? It's, it's not the actual house's fault. The house is not the actual, you can't blame the structure of the house for the dirt that keeps coming out of it. But honestly, calling something shady doesn't seem like strong enough language these days. I'm telling you, I mean, I used to think people understood euphemistic language, but I'm starting to think the lack of clear language is causing a lot of problems. I mean, in other words, it's not that people are too sensitive to language that is the problem. It's that people can no longer derive actual meaning from what's being said due to unclear language. My name is Horace, and I'm a red-tailed hawk. In our world, I do have the body of a hawk, but while fronting, I consider myself a therian. You see, you see, that's what I'm talking about. Like this lovely young lady's problem is not that she's a snowflake, scared and unaccepting of words, resulting in society needing to restrict or change language. Her problem is that language has become ambiguous to the point of useless, resulting in her somehow being able to fall into the usually quite narrowly scientifically defined category of red-tailed hawk. You see, that usually doesn't happen because the definitions are at least a little bit more clear than that. And I don't blame her. I don't blame her. Like if someone told my impressionable young mind as I was following like a red-tailed hawk in awe that I could be one, I mean, I'm sure I would have died trying to fly off a building by now. However, back in the day at a time when elders knew how to scientifically categorize when I as a child made a wild claim of being like a hawk or a squirrel or whatever, I was quickly informed of the incongruity with such a claim to reality. I mean, for example, like I was told, like red-tailed hawks have wings, they have wings. Now, it is true one could be deformed and if you cut off the wings, yes, it would still be a red-tailed hawk, although a very unhappy one. But as a general rule, yes, hawks have wings, the wings spanning approximately four feet. Also, red-tailed hawks mass is around 795 to 1,224 grams. And they usually have yellow legs and feet and red-tailed hawks have a tail. They have a tail, right? I mean, and then like given the proper definition and characteristics of a red-tailed hawk clearly defined, I was forced to confront reality and conclude I was not, in fact, a red-tailed hawk. Yeah, how, whatever, anyway, however, one thing is for sure, when dealing with important topics and seeking clear actionable advice, what you really want to hear is an intro that goes something like this. My name is Joe Biden. I'm Dr. Joe Biden's husband and I ate Chinese ice cream chocolate chip. I came down because I heard there was chocolate chip ice cream. By the way, I have a whole refrigerator full upstairs. I think I'm kidding. I'm not. Honestly, where am I? Is this planet Earth? This cannot be going on here. This can't be right. IR 2023-59, March 27, 2023, Washington. The Internal Revenue Service today continued the dirty dozen series by cautioning taxpayers to avoid unscrupulous tax return preparers and provided important tips to find the right tax professional. People should be careful of shady tax professionals and watch out for common warning signs, including charging a fee based on the size of the refund. Now, at first glance, you might say, hey, why is that a bad practice? Because if they have the fee that's tied to the refund, that kind of aligns our interests in some format because I want as big a refund as possible as well. And if they're getting paid based on a bigger refund, their incentives are lined up with mine. And you also might think, hey, look, that's similar to other situations like lawyers, for example, taking on a case that will possibly be contingent upon whether they win or not in terms of their fees with regards to winning a case or something like that. However, with tax return preparation, you could see how that might lead to kind of a fraudulent type of situation because oftentimes you can have a situation where you file a return that's quite aggressive, if not fraudulent in the claims being taken to increase the amount of the refund. But when the IRS comes back and asks questions at a future point in time, they're going to come back to the taxpayer and it could be likely in a fraud situation or a scamming situation that the person that helped you prepare the tax return will be basically gone by that point in time, right? Because the IRS is a slow-moving type of machine. It's a self-reporting type of system. So the fact that you got a refund in the short run does not mean that you're not on the hook to be audited at least three years out into the future if not beyond that point in time. And by that point in time, it's going to be all you. The person that helped you prepare the tax return might be gone. So your interests aren't aligned by just trying to get the best or biggest refund. You want to get the biggest legal refund because you're on the hook for the liability for the most part if the IRS comes back and then charges you not only the tax, but the penalties and interests that are imposed on top of that, not to mention the time and effort to go in and go through like an audit situation. Okay, so some quote, ghost end quote tax preparers refuse to sign the tax return or ask people to sign a blank return. These are all common warning signs and people should always rely on a trusted tax professional and the IRS offers a variety of resources to help. So when you talk to a tax professional, you might start to think people often do that the tax professional is somehow the person on the hook as if you're talking to the IRS themselves as if if you get approval from a tax professional, that means you're not on the hook for taking an incorrect position on your tax return. That's not the case. The tax professional is acting kind of as your agent in some degree, but you are ultimately on the hook for any decisions being made. Although the tax professional is required generally if they're a paid professional to be putting their information on the tax return so that they have some kind of recourse and if they refuse to do that, that is clearly of course another warning sign of a scammy situation. Quote, most tax professionals offer excellent advice and can rely and can really help people navigate complex tax issues. But we continue to see instances where taxpayers are quote ghosted in quote by unscrupulous tax preparers with bad advice who quickly disappear in quote said IRS commissioner, Danny Warfell quote. We encourage taxpayers to check out the tools and resources available to them to ensure they find the right tax professional for their needs and quote unscrupulous tax return preparers, Mark Day 6 of the IRS's annual dirty dozen campaign. A list of 12 scams and schemes that put taxpayers in the tax professional community at risk of losing money, personal information, data and more. Some items on the dirty dozen are new while others are reemerging. While the dirty dozen is not a legal document or a formal list of agencies enforcement priorities, it is intended to alert taxpayers and the tax professional community about various scams and schemes. Working together as the security summit, the IRS state tax agencies in the nation's tax industry, including tax professionals, have taken numerous steps since 2015 to warn people about common scams and schemes during tax season and beyond that can increase the risk of identity theft. And since then, of course, scamming and scheming has almost disappeared from the face of the earth. They're so effective at it. Hold on a second. Well, whatever. It's still good advice. The security summit initiative is committed to protecting taxpayers' businesses and the tax system from scammers and identity thieves. Choose carefully which credentials of tax return preparers. Choose wisely, as they said in the Indiana Jones movie, or you turn into a pillar of dust or something. Taxpayers should choose a tax preparer as carefully as they choose a doctor or lawyer. After all, the tax preparer is entrusted with sensitive personal and financial information. So don't be choosing like the equivalent of Dr. Fauci for your tax preparation or you'll be sorting through deception after deception. You want to do a little bit more research. So while there are different types of tax preparers with varying levels of credentials and qualifications, there are constants when it comes to finding a preparer. A taxpayer's individual needs will determine which kind of preparer is best for them. Taxpayers are ultimately responsible for all the information on their income tax return, regardless of who prepares the return. Tax professionals are required to have an IRS preparer tax identification number, otherwise known as a P-10 to prepare federal tax returns. The IRS offers resources for taxpayers to educate themselves on types of preparers. Representation rights as well as a directory of federal tax return preparers with credentials and select qualifications. There's a link to that directory here. This directory can help taxpayers find a return preparer with specific qualifications to fit their needs. The directory is searchable and sortable. Don't get ghosted. Avoid shady or self-serving tax professionals. Most tax return preparers provide outstanding and professional service. Unfortunately, there are also some unethical tax preparers that should be avoided at all costs. A major red flag or sign is when the tax preparer is unwilling to sign the dotted line. Avoid these quote ghost end quote preparers who will prepare a tax return but refuse to sign or include their IRS preparer tax identification number, clear sign of a problem because they're not standing by their own position. The fact that they do sign something does not mean that they are on the hook and you are off the hook if there's a problem, but it does mean at least they're put in their name to the advice that they have given and what not in the preparation they have done. So not signing the return could mean the preparer may be looking to make a quick profit by promising a big refund or charging fees based on the size of the refund. This leaves the taxpayer vulnerable and on the hook for any misinformation on the return. So again, no matter what happens, the IRS is a slow-moving machine. The fact that you got a refund, this is where the scam comes in. It's a short-term type of thing. They take the refund, they take their portion of the fees and then they leave and you're still on the hook because the IRS oftentimes is going to be double-checking with audits in the future. That's how they check things typically. So if you get in an audit situation, then you end up paying the tax anyways and penalties and fees and going through a painful and ugly situation. So taxpayers should never sign a blank or incomplete return. Shady tax preparers may ask for a cash-only payment without providing a receipt. Invent false income to try to get their clients more tax credits. So that would be the earned income tax credit actually goes up as income goes up. So that's one of the scammy type of things that they might try to do, which seems counterintuitive at first and the complexity of the child tax or sometimes the child tax credit, but mainly the earned income tax credit is why they target that one. Claim fake deductions to boost the size of the refund, direct refunds into their bank account, not the taxpayers' account. That's really bad. Taxpayers can report preparer misconduct to the IRS using form 14157, complaint tax return preparer. There's a link to that here. If a taxpayer suspects a tax return preparer filed or changed their tax return without their consent, they should file form 14157, a tax return preparer fraud or misconduct affidavit. Make a difference. Report fraud, scams and schemes. As part of the dirty dozen awareness effort, the IRS encourages people to report individuals who promote improper and abusive tax schemes as well as tax return preparers who deliberately prepare improper returns. To report an abusive tax scheme or a tax return preparer, people should mail or fax completed form 14242, report suspected abusive tax promotions or preparers. There's a link to that here. And any supporting materials to the IRS Lead Development Center in the Office of Promoter Investigations. There's an email address you can check out. Alternatively, taxpayers and tax practitioners may send this information to the IRS whistleblower office for possible monetary reward. Woo, there's an incentive. How much? How much do I get? Put the bounty on these people's heads, dang it. Put the bounty out, crying out. For more information, see abusive tax schemes and abusive tax returns preparers. So there's links to all this stuff here. There'll be a link to this in the description.