This document summarizes 5 common scams taxpayers should be aware of. It describes phishing scams where taxpayers are tricked into providing personal information via electronic communication. It warns of return preparer fraud where preparers inflate fees or steal refunds. It mentions that hiding income offshore is increasingly difficult due to FATCA. It notes widespread telephone scams where impersonators threaten taxpayers demanding payment. Finally, it cautions against frivolous tax arguments promoted to avoid paying taxes owed.

1. Five scams every taxpayer should be
aware of this summer..

2. Phishing
Phishing is a tactic used by con-artists to trick unsuspecting victims into revealing personal or financial
information through electronic communication. Scams can take the form of e-mails, texts, tweets or
phony websites, and they try to mislead taxpayers with messages about a pending tax issue with the
IRS, compelling the taxpayer to reveal personal information. Regardless of how official this message
may look and sound, the IRS never makes unsolicited e-mail or text contact with taxpayers about their
tax issues.

3. Return Preparer Fraud
Shady tax return preparers can cause expensive tax problems for taxpayers who fall victim to their
ploys. Common practices for dishonest tax preparers include skimming a portion of their clients'
refunds, charging inflated fees for tax preparation or promising refunds that are too good to be true.
To increase confidence in the tax system, the IRS is asks all paid return preparers to register with the
IRS, pass competency tests and attend continuing education.

4. Hiding Income Offshore
In the past, taxpayers have tried to avoid U.S. taxes by hiding income in offshore banks and brokerage
accounts. The IRS has increasingly cracked down on this practice through the Foreign Account Tax
Compliance Act (FATCA) which requires both U.S. citizens and foreign financial institutions to report
accounts held abroad by U.S. citizens. Taxpayers also evade taxes by using offshore debit and credit cards,
wire transfers, foreign trusts, employee leasing schemes, private annuities or life insurance plans. As the IRS
increases its worldwide reach, it has become more and more difficult to hide income or assets abroad.

5. Widespread Telephone Scams
IRS impersonator scams are widespread and have cost victims millions. In the IRS phone scam, victims
receive calls from persons pretending to be IRS agents who demand immediate payment of a tax debt. They
threaten arrest, deportation, loss of drivers license, etc. Remember, the IRS does not initiate contact with
taxpayers over the phone, nor do they make exaggerated threats. If you receive a phone call from an IRS
agent demanding immediate payment, hang up and report the number to the FTC: https://www.ftc.gov/

6. Frivolous Arguments
Promoters of frivolous tax schemes encourage people to make unreasonable and outlandish
claims to avoid paying the taxes they owe. If a scheme seems too good to be true, it probably
is. The IRS has a list of frivolous legal positions that taxpayers should avoid on IRS.gov. These
arguments are false and have been thrown out of court.

7. To Learn More
Visit
www.reliancetaxgroup.com
or Call
(877) 597-0153