Tax Filing: “Scams That Tax Payers Need to Avoid”
Studies have shown that most of the tax agencies manipulate the tax laws and try to look for the loopholes in them for tax deductions and benefits. Getting involved in tax scams can be avoided if you understand the concepts on which some of the fraud tax agencies work. Learn from: http://www.tax-definition.org
New York, NY (PRWEB) March 26, 2005 -– The Internal Revenue Service (IRS) has
released a report on tax scams and Tax-Definition.org (http://www.tax-definition.org) is happy to share them with tax
filers to alert them to any potential issues -
Tax Tips for E-filers: http://www.tax-definition.org/tax-tips
There have been
many cases of tax scams that have been unveiled by the Internal Revenue Services
(IRS) in their annual listings called the “Dirty Dozen”. There are various tax
agencies and schemes that have been listed for making false claims to the
taxpayers.
Studies have shown that most of the tax agencies manipulate
the tax laws and try to look for the loopholes in them for tax deductions and
benefits. Getting involved in tax scams can be avoided if you understand the
concepts on which some of the fraud tax agencies work.
Most of the credit
counseling agencies that claim to help you in fixing your credit ratings should
be avoided. They generally aim at charging high fees, or monthly charges that
add to your debt.
The IRS Tax Exempt and Government Entities Division is
making audits on such agencies to avoid the exploitation that takes place due to
the debts of low-income customers. The agencies are tax-exempt, yet they charge
high fees for providing credit and debt counseling to their
customers.
There are many unscrupulous tax agencies that advise the tax
filers to move all their assets in a trust. According to them, by putting your
assets under a trust you will be able to reduce your taxes, as the income that
is subject to tax will become lower. This will show deductions in your personal
expenses due to your reduced estate. You will be expected to pay lower gift
taxes.
However, most of the agencies that make suck promises fail to
deliver them. It is important for the taxpayer to hire a qualified professional
to help out in matters like entering a trust. On the other hand, even the IRS is
keeping an eye on such agencies.
Some of the agencies want their
customers to utilize a “claim of right” doctrine. According to this, a taxpayer
tries to file a return with an aim to get a deduction that is equivalent to the
wages that he/she gets. Such a deduction is placed under is interpreted wrongly
and has no basis in law.
Therefore, a taxpayer must gather all possible
information before falling in the trap of fraud tax agencies. The real clause in
the Internal Revenue Code is manipulated by such agencies that propagate tax
scams.
Filing a return is optional, wages cannot be considered as income,
and there are amendments in the tax codes that discriminate against the tax
payers are a few of the false arguments that are advertised by the tax agencies.
One should not fall for any of these lousy statements. They have been challenged
and thrown out of the courts.
More and more of such scams have been
unearthed that refute, or manipulate different arguments and codes for tax
exemption. A tab on the identity thefts; on the telephone, Internet, and frauds
posing as IRS members; is essential.
If the IRS catches hold of such con
agencies and people involved with them; fine and imprisonment are inevitable.
But, even the tax payer should be aware of all the legalities involved in filing
their taxes to avoid taking help from outside.
Stay tuned for our second
report on what tax payers / electronic filers need to watch out for: http://www.tax-definition.org/Define-File-a-return.html
You
can also review Tax deinitions here: http://www.tax-definition.org/Define-Form-1040.html
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Tax-Definition.org
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Source : http://www.prweb.com/releases/2005/3/prweb222193.htm