JACKSONVILLE, Fla. – The Internal Revenue Service is asking taxpayers to use caution in order to avoid any scams from “ghost” tax return preparers with U.S. federal income taxes needing to be filed by April 17.
According to an IRS release, a ghost preparer is someone who is paid to prepare a tax return, but does not sign it either electronically or on paper as the paid preparer.
The release said the ghost preparer can print the paper return for their client and tell them to sign and mail it to the IRS.
For electronically filed returns, they prepare it but won’t digitally sign it as the paid preparer.
By doing so the return preparer is kept hidden because the tax return appears to be self-prepared with no indication that a paid tax preparer was used in completing the tax return.
The release went on to say that by law, anyone who prepares or assists in preparing federal tax returns for compensation must have a valid 2018 preparer tax identification number (PTIN) before preparing any tax return.
Tax preparers should sign the tax returns they prepare and include their PTIN on the return.
The IRS said that for 2018, it has issued more than 737,000 PTINs to tax preparers.
Shady tax preparers could also require payment in cash only and not provide a receipt, invent income to falsely qualify clients for tax credits or claim fake reductions to enable the taxpayer to get a larger refund, or direct refunds into their own financial account rather than the taxpayer’s account.
Taxpayers, who are legally responsible for what is on their tax return even if someone else prepares it, can report abusive tax preparers to the IRS by using Form 14157 or Form 14157-A.
To find a tax preparer, taxpayers can visit the IRS preparer directory at www.irs.gov/chooseataxpro.