Tax scams: Beware the 'dirty dozen'
With April 15 right around the corner, the government cautions taxpayers to avoid these tax scams.
NEW YORK (CNNMoney.com) -- As taxpayers scrounge up deductions to pump up their refund in the final days before April 15, the IRS issued a warning about 12 tax scams that will land you in hot water.
The schemes run the gamut from responding to emails that look like they are from the Internal Revenue Service to trusting fraudulent tax preparers.
If you receive a false email that appears to come from the IRS, forward it to phishing@irs.gov, where the government has received tips about thousands of phishing sites.
Phishing is when a group contacts unsuspecting individuals via email and convinces them to disclose personal or financial information. The scam artists dupe filers with an email address that appears to come from legitimate organizations, like the IRS.
Also, be careful about who is preparing your taxes for you. There are those who are more than happy to skim off the top of their clients' refunds and/or charge excessive fees. The IRS says it has seen it all.
And then there are those that think they can 'get away with it.' Not so says the IRS.
"There is no secret trick that can eliminate a person's tax obligations. People should be wary of anyone peddling any of these scams," IRS Commissioner Doug Shulman said in a statement.
Intentional or not? Other scams include exaggerating or falsifying income deductions on your taxes to bolster your refund, as well as abusing donations to tax-exempt organizations by overvaluing them or never actually making the donation.
And retirement plans get abused as taxpayers, sometimes unwittingly, misrepresent transactions to avoid limits set on contributions to IRAs, including Roth IRAs. The IRS has also seen trusts being misused in an effort to avoid income tax liability and hide assets from creditors, including the tax man.
False tax deductions can also be costly, if you are caught. An unreasonable fuel tax deduction, for example, can cost you $5,000.
Furthermore, the government continues to crack down on taxpayers who try to avoid U.S. income tax by keeping their funds in offshore banks. In February, UBS (UBS), Switzerland's largest bank, was accused of helping as many as 52,000 U.S. customers hide assets from the IRS. The secret accounts are thought to contain as much as$15 billion in taxable assets.
The IRS is also on the lookout for taxpayers forming false corporations to hide assets. Taxpayers underreport income, exaggerate deductions, launder illegal money or even fund terrorist activity via these false companies, said the IRS.
The IRS has seen scam artists file false returns to get refunds they do not deserve. Still other tax scammers apply for a tax abatement with Form 843, without even having filed a tax return in the first place.
The IRS has even seen numerous cases of tax filers claiming their income is zero on false documentation. Without any reported income, a tax filer claims to not owe any income tax.
If you suspect tax fraud, you can report it to the IRS by filing Form 3949-A. And if you unveil a scam involving big bucks, you could be eligible for an award. Whistleblowers should fill out Form 211, the Application for Award for Original Information. You are only eligible for the award if the tax amount in question exceeds $2 million and the individual taxpayer's gross annual income is more than $200,000. 
