IRS warns of scam

Published 10:28 pm Thursday, July 28, 2011

The Internal Revenue Service issued a warning to residents of Dallas County and some surrounding counties of a working scam targeting the elderly and those who receive Social Security or other government benefits.

The IRS said those operating the scam are trying to persuade victims to file false claims for tax credits or rebates.

The service noted an increase in tax-return-related scams frequently involving “unsuspecting taxpayers” who normally do not have a filing requirement in the first place, the release said. The IRS said the scams are most active in Clark, Hale, Marengo, Mobile, Montgomery, Perry, Washington and Wilcox counties, as well as those currently underway in Dallas County.

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These scams have been reported in 33 states, including Alabama, Florida, Georgia, Mississippi and Tennessee. In the Southeast, the scam appears to be most active in Alabama and Mississippi.

“Refunds, credits or rebates are to be issued only to those who are entitled to them, so I would like to advise taxpayers to please be cautious before signing up for any tax credit or rebate,” Reginael D. McDaniel, Special Agent in Charge of IRS Criminal Investigation, Atlanta Field Office said. “I would also like to warn anyone who is willing to become involved in the proliferation of these schemes, you are exposing yourself to felony prosecution and possible incarceration.”

The IRS warned the elderly and those who receive Social Security or other government benefits are primarily the ones being targeted by the scammers.

The victims are led to believe they should file a return with the IRS for tax credits, refunds or rebates for which they are not really entitled.

“These schemes often spread by word of mouth among unsuspecting and well-intentioned people telling their friends and relatives,” IRS spokesman Dan Boone said.

In some cases non-existent Social Security refunds or rebates have been the bait used by the con artists. In other situations, taxpayers deserve the tax credits they are promised but the preparer uses fictitious or inflated information on the return, which results in a fraudulent return.

Promoters of these scams often prey upon low-income individuals and the elderly. Flyers and advertisements for free money from the IRS, suggesting that the taxpayer can file with little or no documentation, have been appearing in community churches around the country. Promoters are targeting church congregations, exploiting their good intentions and credibility.

They build false hopes and charge people good money for bad advice. In the end, the victims discover their claims are rejected or the refund barely exceeds what they paid the promoter. Meanwhile, their money and the promoters are long gone.

Unsuspecting individuals are most likely to get caught up in scams and the IRS is warning all taxpayers, and those that help others prepare returns, to remain vigilant.

“If it sounds too good to be true, it probably is,” Boone said.

Anyone with questions about a tax credit or program should visit, call the IRS toll-free number at 800-829-1040 or visit a local IRS Taxpayer Assistance Center.

For questions about rebates, credit and benefits from other federal agencies contact the relevant agency directly for accurate information.

To report suspected tax scam activity in Alabama, contact the IRS Criminal Investigation office in Mobile at (251) 341-5982.
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