BIRMINGHAM, AL (WSFA) - The Internal Revenue Service says tax scams are growing and many are happening in at least nine Alabama counties.
Scams are most active in Clarke, Dallas, Hale, Marengo, Mobile, Montgomery, Perry, Washington and Wilcox Counties, accord to an IRS statement.
The IRS is noting an increase in tax-return-related scams frequently involving unsuspecting taxpayers who normally do not have a filing requirement in the first place and warns that 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.
The 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.
Reginael D. McDaniel, Special Agent in Charge of IRS Criminal Investigation, Atlanta Field Office said, "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. 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."
To report suspected tax scam activity in Alabama, contact the IRS Criminal Investigation office in Mobile at (251) 341-5982.
HOW TO SPOT THE SCAM
"These schemes often spread by word of mouth among unsuspecting and well-intentioned people telling their friends and relatives," said IRS spokesman Dan Boone.
Taxpayers should be wary of any of the following:
- Fictitious claims for refunds or rebates based on excess or withheld Social Security benefits.
- Claims that Treasury Form 1080 can be used to transfer funds from the Social Security Administration to the IRS enabling a payout from the IRS.
- Unfamiliar for-profit tax services teaming up with local churches.
- Home-made flyers and brochures implying credits or refunds are available without proof of eligibility.
- Offers of free money with no documentation required.
- Promises of refunds for "Low Income – No Documents Tax Returns."
- Claims for the expired Economic Recovery Credit Program or for the Recovery Rebate Credit.
- Advice on claiming the Earned Income Tax Credit based on exaggerated reports of self-employment income.
"If it sounds too good to be true, it probably is," Boone said.
INFORMATION SOURCE: IRS