Tax Season Tips: Avoiding Audits And ID Theft
For any number of reasons, tax season is stressful. Sure, everyone loves getting their return (if you don’t believe that, check the sales of Big Screen TVs and other luxuries in late April) but at what price? Outside of the sometimes exorbitant fees charged by tax preparers, modern citizens also have to contend with the “paper file versus efile taxes” debate and be concerned with identity theft.
What do you mean identity theft?
Oh, you hadn’t heard? Tax season is like Christmas for frauds and thieves. Late filers often find their returns rejected because an identity thief has already submitted a big, fat phony return using their name. And while IRS resolution centers work very hard to try to catch fraudulent tax returns and identity thieves, there are simply too many out there. That’s why each year, 50 year old grandmothers and 19 year old food service employees alike are at risk. Each year, the IRS releases a “Dirty Dozen” list to help you stay alert.
There is an enormous list of ways to fall victim, several of which are detailed in brief below:
Identity Theft: We’ve spoken about this already. Someone uses your personal information, such a Social Security number, to commit fraud. Commonly, they will file tax returns to claim refunds, typically under $5,000. Then your return gets rejected, and you’ve got months of headaches while it all gets sorted out.
Phishing: Computer criminals commit identity theft or financial theft after gaining personal information through the use of false e-mails or websites. A good thing to keep in mind to avoid being “phished” is to remember that the IRS never contacts taxpayers through any type of electronic communication.
Return Fraud. According to the IRS, 60% or so of taxpayers will go to professionals – H&R Block, Jackson Hewitt, or other tax preparers – to get tax help. The vast majority of them will get exactly what they’ve gone for: honest help. An unlucky few will fall victim to unscrupulous tax preparers. It is important to never sign a blank return, and to choose carefully when deciding on a tax professional. Even if you’ve gotten someone else to do your taxes for you, you and you alone are liable for the information put down on the return.
Falsifying Returns. Sometimes it is tempting to commit a low level sort of fraud yourself. Claiming exorbitant expenses to which you are not entitled, or taking advantage of the Fuel Tax Credit, for instance. In these cases, you yourself are the criminal, and the IRS can and will prosecute. Don’t allow false information on your returns.
How You Can Protect Yourself:
Contact the IRS if your wallet is stolen, if your information may be stolen, or if you have questionable credit activity.
Never, ever sign a blank return.
Don’t file your taxes over public Wi-Fi hotspots.
Use a reputable tax preparer or a reputable software
Don’t leave important documents lying out, or in your vehicle, or anywhere thieves can get to them easily.
It’s important to keep these things in mind whether you’re planning to efile taxes or paper file.
Featured images:
License: Creative Commons image source
Tony has been a tax professional for several years and likes to share some tips when it comes to protecting yourself.
Categories: Federal Tax, Income Tax, State Tax, Tax Law Tags: audit, identity protection, identity theft, tax advice, taxes
How To Get Best Tax Relief Specialist In USA
Understanding the complicated and highly personalized nature of past due taxes and payments can be overwhelming or intimidating to those who are not familiar with the particularities of the IRS. The IRS is vigilant in their collection policy which makes the entire process even more intimidating. Whereas credit card companies, and other lenders in the same category, will typically absorb at least a portion of the losses when customers don’t pay, the IRS has no such leniency.
In simple tax situations the tax payer can likely handle arranging and understanding the tax laws and payment process. However, the majority of tax situations are endlessly complicated and partnering with a tax relief company is, without a doubt, the best way to ensure your personal situation is accurately, efficiently and professionally handled by people who care about you as well as the resolution of your tax bill. All tax relief companies are not created equal. Before you entrust your finances and IRS communications to a tax relief organization, do your research! Understanding what a tax relief company does, will make it significantly easier to spot ones that should be avoided. Preparing ahead of time will assist you in determining how to get the best tax relief specialists in the USA.
What can a Tax Relief Company do?
First things first, what is a tax relief company? The tax industry is segmented into a variety of professional specialties. Choosing the best company or person to assist you is dependent on the unique circumstances of your tax situation. Accountants and other well-trained individuals can assist you in preparing your taxes for submission and saving you the maximum amount of money. However, if you are already at the point where you owe the IRS than it’s time to consult with a tax relief company.
In most cases, individuals wait until they have received a delinquent tax bill before they turn to a tax relief company (though, if you suspect such a bill is coming save some stress and time by consulting a tax relief specialist early!). Reputable companies will offer a free consultation to discuss your tax dilemmas and personal finances before they take your case. This way, if they cannot be of assistance to you, no time or finances are wasted by consulting them.
Once your case is accepted by a tax relief company they will develop a thorough plan to assist you with the delinquent tax issues and your communication with the IRS. The company of your choosing will be your personal representative when communicating with the IRS which makes it imperative that you disclose all applicable financial details so you receive accurate representation. Having a trained company on your side to act as the IRS Power of Attorney is an immense benefit when you’re trying to understand the complications of tax bills – it’s also why you need to carefully consider which representation you choose.
What Red Flags are there when choosing a Tax Relief Company?
To save yourself all the tax headaches you’re already trying to avoid – do your homework. Unfortunately, the tax industry does have some companies and individuals who are merely trying to make money off a desperate individual a time-sensitive situation. Obviously, such companies do not have your best interests are heart.
When choosing a company it’s crucial to be aware of the following red flags; they indicate everything from poorly managed business to fraudulent companies that you are better off avoiding.
1) Poor Reviews: Always, always, always research the tax relief company you’re interested in online before even arranging a consultation. Consult the Better Business Bureau’s website to see customer feedback. While online reviews can be subjective, multiple bad reports about a company indicate that it’s an organization that would be better to avoid. When you’re working to correct a tax debt you want to choose the best option that is available to you.
2) Premature Guarantees: Make sure the company differentiates between a guarantee of their service or availability and a guarantee about your IRS case results before they see your paperwork. Early guarantees are a marketing ploy to gain customers but are not a valid promise the company can or should make to a potential client.
3) Initial Fees: Do not select a company that charges a large upfront fee. Their goal is to make money before contracting because they will be either unable or unwilling to assist with your case. Some companies may charge a small retainer fee (after the initial consultation), that’s acceptable but always ask to see a complete list of charges per service before contacting with a company. It’s important to understand all the costs associated with hiring a tax relief agency – if they’re exorbitant it may be wiser to deal with the IRS yourself (or, to price shop between companies).
Obviously, working with a tax relief company can be an enormous relief for a client who wants to comply with IRS standards and payment resolution. Once you’ve done your research and selected a reputable company to act on your behalf; you will be guaranteed a dedicated tax relief specialist who will honestly represent you and work to resolve your tax debt with the IRS as rapidly and carefully as possible.
Author Bio: I am Tim from Optima Tax Relief team. You can contact me for more tax relief tips even can arrange a consultation with us. We are here to assist you!
Categories: Federal Tax, Income Tax, State Tax Tags: tax advice, tax relief plan, tax relief specialist
How To Make Money With Tax Liens From Foreclosures?
According to various sources, Tax Lien Certificates have been said to be the safest investments till now. But most of us don’t know how they work, and that’s why it best to share how one can become financially independent with tax liens. It pays to be well informed, especially when your government is assuring you of a good return on your investment and this should eventually be a good method of making some quick money.
So what are Tax Lien Certificates?
Tax Lien Certificates are bought from the government and taken home. They have proven their worth as a very lucrative and safe investment option, especially in this shaky economy. By investing in Tax Lien Certificates, you invest not in private institutions, but with the governing bodies. When they get paid or when the certificates you buy are redeemable, the check is sent to you for the same from their end. In short, the process is very simple; you invest and you are paid back, the government takes care of it.
What is a tax certificate?
A tax certificate would be an important paper which shows all the unpaid debts of a property owner. If you own property, you are required to pay local taxes. People often default in these payments by not paying their taxes on time while some don’t pay the taxes at all. The local governments face a problem when these funds don’t come in and many utility services run by the local governments end up on the receiving end. These necessary funds are often required to pay salaries to the police, firemen, schools etc, none of which would run and function if our tax money doesn’t reach the government. Imagine no schools, no post offices, no government services, all because we didn’t pay our taxes!!
How it works?
The local county would issue Tax Lien Certificates that you can buy on the delinquent properties you own. And you can buy the certificates over the counter or at auctions; as you will be rewarded well in the long run.
There would be a penalty for paying taxes past due, and paying penalties on delinquent properties would be higher. Hence, delinquent property holders first have to pay the penalties and then pay off their taxes.
Why choose government Tax Lien Certificates?
- They are predictable with their rates and payouts
- You are assured of checks coming in the mail by the government
- These certificates are backed by the Real estate
- You don’t have to deal with brokers and middlemen
- You buy them directly
- Tax Lien Certificates have a priority over everything else, even more than mortgages.
- If you have Tax Lien Certificates, you can make money from the government on the delinquent real estate you own.
So Tax Lien Certificates is it?
Now that you know how Tax Lien Certificates can be beneficial to you in helping make money that you need, ensure that you speak to experts on how to buy them and become independent financially.
Today’s guest post is penned by Adam Anderson. He is a financial expert who likes sharing his view on the latest financial policies and investments in his blog. He says that with the latest development in the online banking sector, getting payday loans has become relatively easy.
Categories: Federal Tax, Income Tax, State Tax, Tax Law Tags: finance advice, foreclosure help, making money, tax advice, tax liens