David Anderson is principal of David Anderson & Associates, a Philadelphia forensic accounting firm that provides a full range of fraud investigation, fraud deterrence programs, and forensic accounting services in Philadelphia and the Delaware Valley.

Here, once again, is the annual list released by the Internal Revenue Service of the top tax scams it has come across this past year. Please take a few minutes to read though them, and to share them with your staff, so you don’t fall prey to one of them:

• Fake e-mails and/or tax websites: Also known as phishing, this scheme usually begins with scammer sending you an e-mail that is purportedly from the IRS or your state or local revenue department. The e-mail says that there is a problem with your return which will either prevent you from receiving your expected refund or which could result in severe penalties and increased taxes.  It asks you to return certain personal information such as your Social Security number, date of birth, credit card number or bank account number.  Other e-mails ask you to go to a website (set up by the scammer) and enter the information.  What most people don’t realize is that the IRS and/or state and local revenue departments not only don’t have your email address, they wouldn’t use it in any correspondence.  The real purpose of these scams is to get your personal information for either identity theft or to take your money.

• Phone scams: This scam, which I wrote about in a recent blog post, involves receiving a threatening phone call from a scammer posing as an IRS agent. The scammer says you’re under surveillance and you, your house, car and assets will be seized or that you could be arrested and/or deported. They tell you the only way out is to immediately pay taxes that you owe by purchasing a prepaid debit card and giving the card information to the “IRS agent”.  Here is another instance of contact that the IRS doesn’t really use.  Most IRS contact is via mail.

• Return preparer fraud: This scam involves a tax return preparer who perpetrates a fraud to get you a large refund or one who steals your identity using the personal information you provided to him/her. In the case of the large refund, the preparer may provide fake W-2 forms or claim credits for you that you don’t deserve (for example, adding dependents to your tax return and claiming the child care credit when none is warranted).  In the case of identity theft, the preparer may properly prepare your return, but may arrange for any refund to come to him/her or may later use your personal information to open credit cards or take out loans for his or her benefit.

• Fake charities: Scammers set up a fake charity – in many cases with a name similar to a real charity – and solicit donations. Because the charity is fake, donations are disallowed by the IRS.

• Fake business credits: The dishonest taxpayer claims credits for excise taxes paid on fuel and/or phony research tax credits.

• Claiming business expense deductions for personal expenses paid by a business: In this plan, the dishonest taxpayer has his or her business pay for personal expenses – such as vacations and personal travel, personal automobile expenses, personal cell phone expenses, personal meals and entertainment expenses – and then claims the expenses as valid business expense deductions.

• Falsely padding deductions: The dishonest taxpayer claims excessive and non-existent deductions for medical expenses, taxes, interest, charitable contributions, casualty and theft losses, and/or miscellaneous deductions.

If you require the services of a forensic accounting expert in Philadelphia and the Delaware Valley, please contact the Philadelphia forensic accounting firm of David Anderson & Associates by calling David Anderson at 267-207-3597 or emailing him at david@davidandersonassociates.com.

About David Anderson & Associates

David Anderson & Associates is a Philadelphia forensic accounting firm that provides a full range of forensic accounting services in Philadelphia and the Delaware Valley.  The experienced professionals at David Anderson & Associates provide forensic accounting, business valuation, fraud investigation, fraud deterrence, litigation support services, economic damage analysis, business consulting and outsourced CFO services.  Company principal David Anderson is a forensic accounting expert in Philadelphia with more than 30 years of experience in financial and operational leadership positions. He is a Certified Public Accountant, a Certified Fraud Examiner and a Certified Valuation Analyst.  Anderson also has provided expert witness testimony in the Greater Philadelphia area and served as a forensic consultant on both civil and criminal cases.