Editor’s note: This is a transcript of the audio file.
Tax season is prime tax scam season. That’s why you should know the year’s top tax tricks to avoid becoming a victim. I’m Clark Palmer with your Bankrate.com Personal Finance Minute.
People often fall prey to unscrupulous promoters who have convinced them to transfer assets into improperly designed trusts. Beware of a trust that promises to reduce the amount of income subject to tax, offers deductions for personal expenses or claims to lower estate or gift taxes.
Con artists also convince people that the government maintains secret accounts for all U.S. citizens. He offers to help his victims get access to the accounts by issuing a fake version of a real tax form, usually Form 1099 Original Issue Discount, to the IRS.
Con artists also claim they can get filers free money from the IRS. They typically post fliers advertising free IRS money. Fliers are often posted in churches, helping word spread. The scammer collects money to file fake claims and then he’s long gone before victims learn that their claims are rejected.
For more tax tips, visit Bankrate.com. I’m Clark Palmer.