The IRS is particularly interested in investigating tax preparer fraud because it affects so many returns. If the IRS shuts down a single corrupt tax preparer, it could prevent hundreds of fraudulent returns from being prepared each tax season.
Most tax preparers, however, are honest professionals who want to avoid accidentally creating a problem with the IRS. The following tips can help increase the odds you’ll have a successful tax season without receiving any unwanted mail from the IRS:
Understand Your Due Diligence Requirements
You have the ability to reasonably rely on a client’s statements. The client has their own duty to tell the truth on their tax return. However, you also have to verify the information and ask the right questions, especially when certain red flags are raised.
It’s not uncommon for clients to go to multiple tax preparers, complete the interview, then see which preparer is offering the biggest return. Although each return should be identical, this puts the preparer in a tough position because they want to keep their client’s business.
Don’t make the mistake of turning a blind eye to obvious errors or omissions in order to give a client a bigger refund. It’s not worth an IRS investigation. Ask the right questions to get the refund they deserve under our tax laws, even if it’s not the refund they want.
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