The IRS Dirty Dozen list has arrived

On February 19, the IRS released it’s “‘Dirty Dozen’ Tax Scams for 2014.” The list has become an annual warning about how the bad guys are using the IRS as a way to make money.

Topping the list this year was “Identity Theft.” The IRS has jumped on the “Identity Theft is Bad” bandwagon and even has an Identity Protection section on their website. Take it from someone who’s been there, identity theft really is a pain in the you know what. Fortunately, there are far more resources dedicated to helping victims than there were “back in the day.”

I have nothing against declaring Identity Theft a huge danger to our personal security, but number 2 on the list really gets into the meat—pervasive phone scams. I covered this scam on January 3 in my post The (Fake) Tax Man Cometh and I’m glad to see it make the “Dirty Dozen” list because it’s a beauty—a throwback to the “good old days” when all we had to worry about were telemarketers. Well, they’re back and you want nothing to do with them. You can check out my January 3 post for details here or just be aware that the guy calling who claims to be with the IRS may not be for real.

The third item on the IRS list is phishing. It’s a subject I’ve beaten to death, so let’s move on to number 4 because it’s specific to the IRS. That number 4 slot goes to false promises of free money due to overinflated refunds. The IRS said in their announcement, “Scam artists use flyers, advertisements, phony store fronts and even word of mouth to throw out a wide net for victims. They may even spread the word through community groups or churches where trust is high.”

What’s worse is that if you hire someone to prepare your taxes and they file a fraudulent return with or without your knowledge, you are still on the hook for the tax and penalties—oh, and did I mention the possible $5,000 fine if the IRS determines that you deliberately filed a fraudulent return?

I’ve only covered the first four items on the list. You can read the full release on the IRS website if you’d like, it includes more juicy tidbits like tax preparer fraud, impersonation of charities, false income, frivolous arguments, and one that I’m sure applies to most of us, hiding income offshore. I’ll have to work on that. Can I open an offshore account with a $5.00 deposit?