Tax Scams: File tax return early to avoid fraud
Taxes are front of mind for me right now, so I am determined to get my taxes filed as early as possible, both for myself and my business. I know my accountant will appreciate this but does filing returns before April have any other benefits?
As CPAs and tax professionals we wholeheartedly agree that the sooner you get your tax returns filed, the better! Since you’re thinking about making the tax return preparation process smoother and more efficient in 2018, you are already on the right track to a less stressful filing season. When people wait until the last minute to file their returns, they often make mistakes and may pay more than is necessary by omitting essential tax deductions and credits. We have summarized a few critical steps to consider as you begin preparing your returns.
Send it as it comes
Accountants do appreciate getting your documents early, even if a few aren’t available to them yet. Also if you’re missing a portion of your information, your CPA can still get started on your return. Consider sending in the majority of your data early with a follow-up of the late-arriving 1099s or Schedule K-1s. It is a good idea to compare the documents that you receive to your records to ensure that the information reported to the IRS is correct. If you do find an error, let the reporting organization know so that they can file the “corrected” information with the IRS. Otherwise, you can expect a notice shortly after you submit your return.
Avoid tax return fraud.
In an increasingly common (and alarming) scam, identity thieves use victims’ personal information to file fraudulent tax returns electronically and claim bogus refunds. When the real taxpayers go to file their returns, the IRS notifies them that they’re attempting to file duplicate returns. It can take months to fix and can delay legitimate refunds. By submitting your taxes as early as possible, you will reduce your risk of becoming a victim.