International Fraud Awareness Week: Fraud, Scams and Schemes
This week is International Fraud Awareness Week, the Internal Revenue Service is reminding taxpayers how to report tax-related fraud in their community to protect personal and financial information from scam artists and tax schemes.
During International Fraud Awareness Week, November 17-23, the IRS Office of Fraud Enforcement and IRS Criminal Investigation aims to raise awareness of fraud, scams, and schemes affecting taxpayers across the country.
The IRS also encourages people, businesses, and tax professionals to take time now to learn to recognize red flags and to ensure defenses are in place to stop scammers and those who promote unscrupulous tax schemes.
The Security Summit, a public-private partnership between the IRS, state tax agencies and the nation’s tax industry, also works to protect taxpayers, businesses, and the tax system from identity thieves and warn people to watch out for common scams and schemes.
How to Report Tax Fraud
Tax fraud comes in many forms, including scams targeting individuals, tax-related schemes by bad actors, and fraud committed by taxpayers who knowingly file incomplete or inaccurate information with the IRS.
We, the public can assist the IRS in identifying and investigating possible fraud of individuals and businesses by filing Form 3949-A, Information Report Referral. Form 3949-A is a tax-related public use form submitted voluntarily by individuals to report alleged violations of tax law by individuals and businesses. All Form 3949-A submissions are confidential.
Some of the suspected tax law violations you can report are false exemptions and deductions, multiple tax filings, organized crime, political corruption, and kickbacks, unreported income, illegal drug income, gambling income, and failure to pay or withhold tax and file tax returns.
The IRS reviews all submissions and determines the appropriate action to take. This may include an audit or possible criminal prosecution.
Possible Financial Reward
The information you report regarding fraudulent tax-related activity can sometimes lead to a possible monetary award. You would then need to submit Form 211, Application for Award of Original Information. It will be evaluated by the IRS Whistleblower office.
Fraud, Scams and Schemes
Each year, the IRS compiles a Dirty Dozen list that brings public awareness to a variety of common scams that taxpayers may encounter. This year’s list included phishing scams, questionable Employee Retention Credits, Fuel Tax Credit claims, Offers in Compromise mills, and fake charities.
Anyone experiencing these scams, or taxpayers encountering promoters or tax preparers peddling these schemes, are encouraged to submit Form 14242, Report Suspected Abusive Tax Promotions or Preparers.
You should mail or fax a completed Form 14242 and any supporting materials to the IRS Lead Development Center.