Valdosta Daily Times

March 3, 2013

IRS now accepting all forms

Tax fraud on the rise

Stuart Taylor
The Valdosta Daily Times

VALDOSTA — Last month, the IRS Oversight Board released the 2012 Taxpayer Attitude Survey, finding that, among other things, 87 percent of respondents said it “was not at all acceptable” to cheat on taxes, 95 percent cited “personal integrity” as their greatest influence on reporting honestly, and 93 percent felt it was important for responders to meet competency standards.

That's right, it's March once again, which means you might want to seriously start thinking about filing your taxes.

After months of limiting which types of forms they would accept, by the middle of the first week of March, the IRS should be accepting all tax forms and returns.

“They've actually been doing an amazing job, considering that all the new tax laws weren't passed until January 2nd,” said Terry Conley, who, with his wife, Cathy, runs TC Tax Service.

Some of those tax laws passed in January are retroactive, so they reach back to affect your 2012 return.

“The Alternative Minimum Tax has been permanently tied to inflation and the Child Tax Credit has been set at $1,000,” said Cathy. “Also, the Tuition and Fees deduction, which was supposed to end in 2011, has now been been extended and applies to 2012.”

Terry and Cathy see a number of common mistakes and errors people make when filing.

“We get newlyweds where the bride hasn't legally changed her name,” said Cathy. “People will forgot about property, ad valorem taxes, credits for children.”

“People who have spent at least 7.5 percent of their adjusted income on medical expenses can file their mileage as well, for 23 cents a mile,” said Terry. “We have people coming in who've had to go back and forth to hospitals in Jacksonville and Tallahassee over and over and don't think about it. And charitable mileage can get 14 cents a mile.”

Identity theft has been a problem for years, but this year, the IRS is reporting a large upswing in identity fraud on tax forms.

Fraudsters, after getting someone's identification information, will file a fraudulent return, resulting in a large refund check for them. When the actual person goes to file their taxes, they're informed that they already have.

“Before this year, I had seen one case of fraud in the last ten years,” said Terry. “This year we've seen seven or eight. We even have seen a few widows who find that someone has filed as their spouse...There are fixes for it, but it slows the process down. Your refund gets delayed several months.”

It's become such a problem this year and last that the IRS has formed a branch just to deal with fraud cases.

As prevention, the Conley's advise everyone to file as soon as possible to be on guard and protect their personal information.

“Every year, bogus IRS websites pop up that look official,” said Cathy. “If you don't initiate contact, the IRS will never email you. They will never e-mail you attachments. They have started calling people this year, but that's still rare.”

The IRS also reports that 80 percent of tax returns were filed digitally last year.

“We do file digitally; it's the best way to avoid data entry errors on the other side,” said Cathy. “I don't have anything bad to say about Turbo Tax and things like that, but you only get out of those programs what you put into them.”

Cathy and Terry do have some general advice for everyone. Keep good records, whether you're filing individually, as a couple, or for your business. If you have a business, get a separate account for business expenses and don't commingle your personal expenses into it. If you're using a tax preparer, be cautious.

“Be wary of anyone promising you a return, or guaranteeing no tax liability,” said Cathy. “If they're an enrolled agent with the IRS, they should have a certificate and a PTIN.”

The PTIN, or Preparer Tax Identification Number, identifies the preparer to the IRS.

However you decide to file and whatever forms you need to submit, get on it. April 15th is only six weeks away.