DALLAS CPA SOCIETY CONTINUING EDUCATION CORPORATION MEMBER APPRECIATION CPE SERIES. October 26, 2016

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1 DALLAS CPA SOCIETY CONTINUING EDUCATION CORPORATION MEMBER APPRECIATION CPE SERIES October 26, 2016 TIGTA & You: Protecting Clients and Taxpayers Tom Traxinger Assistant Special Agent in Charge, Treasury Inspector General for Tax Administration Course Description: This session is an overview of TIGTA s role in promoting integrity, economy and efficiency in the administration of the nation's tax system. Learning Objectives: This session will: 1. Define TIGTA s role in protecting the integrity of tax administration; 2. Differentiate between TIGTA s jurisdiction and that of the IRS; 3. Identify the various forms of preparer misconduct; and 4. Identify common IRS impersonation scams. Course Level: Prerequisites: Technical None

2 TIGTA & You: Protecting Clients and Taxpayers Learning Objectives Define TIGTA s role in protecting the integrity of tax administration Differentiate between TIGTA s jurisdiction and that of the IRS Identify the various forms of preparer misconduct Identify common IRS impersonation scams What is TIGTA? Provides independent oversight of the IRS Protects the integrity of Federal tax administration Detects and prevents waste, fraud and abuse Has three primary operating divisions: Investigations Audit Inspections and Evaluations 1

3 Office of Investigations Protects the IRS from external threats and corruption Protects the integrity of IRS programs, operations, and critical infrastructure Detects and prevents fraud and abuse Identifies and investigates IRS employee misconduct I.R.C Prohibits disclosure of tax returns or return information, except as authorized by an exception contained in I.R.C Ethics and Integrity (According to Webster s Dictionary) Ethics: A group of moral principles or set of values Integrity: An uncompromising adherence to a code of moral, artistic, or other values 2

4 Circular 230 Circular 230, also known as Subtitle A, Part 10 of Title 31 of the CFR Sets forth rules under which tax preparers can represent clients before the IRS OPR oversees most preparer conduct Preparer Misconduct False statements on Forms 2848, Power of Attorney and Declaration of Representative Failure to disclose that preparer is disbarred or otherwise unauthorized to appear before the IRS Preparer Misconduct (cont.) Sending s or fabricating documents purporting to be from the IRS Improper disclosure of tax information 3

5 Preparer Misconduct (cont.) Levy Release 1 Levy Release 2 Preparer Misconduct (cont.) Preparer Misconduct (cont.) 4

6 Preparer Misconduct (cont.) Preparer Misconduct (cont.) Unauthorized disclosure of protected tax information Preparer Misconduct Case Cynthia Lozano Federal tax fraud and identity theft Received over $1 million in fraudulent refunds and purchased 20 properties Feb pled guilty to Wire Fraud and Aggravated ID theft 5

7 Preparer Fraud Andrew Zelenkofske defrauded client with false IRS debt Prepared a false Release of Levy and submitted to financial institution 36-months Federal prison sentence IRS Impersonation Scam Largest ever phone scam Calls to taxpayers in most every state Callers claim taxpayers owe back taxes and must pay immediately Callers are aggressive and threatening Traits of Scam Callers May know the last four digits of intended victim s SSN Spoof caller ID information to appear as if calling from the IRS Demand payment using a prepaid money card, itunes, MoneyGram, etc 6

8 Traits of Scam Callers, cont. Send bogus IRS s to legitimize the scam Subsequent calls claiming to be the police, DMV, or other IRS function to verify initial debt claims and confirm threatened legal action States Hardest Hit by Phone Scams California New York Texas Florida Connecticut IRS Impersonation Runners Jailed Victims buy prepaid debit cards to pay alleged debts Scammers use runners in U.S. to purchase money orders from prepaid debit cards Money orders deposited into bank accounts controlled by scammers 7

9 Other Impersonation Schemes False IRS websites Hyperlink on spam Phishing Official IRS ? Suspicious s 1. Forward the suspect to 2. Delete it from your computer 3. DO NOT reply, open any attachments, or click on any links 8

10 Victims of IRS Impersonation (Phone or Scams) Call the IRS at (if victim knows or thinks taxes are owed) Call the TIGTA Hotline at (if victim knows no taxes are owed) Contact bank if financial information given to scammer Reporting Scam Calls How Can You Protect Federal Tax Administration? Report instances of tax preparer or IRS employee misconduct Report allegations of potential risks to IRS employee safety Warn taxpayers about phone scams 9

11 How to Contact TIGTA us: Call us: Houston, TX (713) Dallas, TX (972) Austin, TX (512) QUESTIONS? 10

12 Thomas J. Traxinger Assistant Special Agent-in-Charge Treasury Inspector General for Tax Administration Dallas Field Division Tom Traxinger is the Assistant Special Agent-in-Charge (ASAC) of the Dallas Field Office of the Treasury Inspector General for Tax Administration (TIGTA), Office of Investigations. Tom has a B.S. in Psychology and Economics from South Dakota State University and a MS in Management and Leadership. Tom began his federal law enforcement career in 1985 as a Special Agent with the United States Army. In 1998 Tom left the Army to continue his law enforcement career with TIGTA (formerly IRS Inspection Service). Tom has received numerous awards for his investigative accomplishments and was Agent of the Year and he was also recognized by the Presidents Counsel on Integrity and Efficiency for investigative excellences. He has been married for 31 years and has two grown daughters and one grandson. TIGTA protects the Department of Treasury's ability to collect tax revenue. TIGTA's administers investigative and audit programs that protect the integrity of the Internal Revenue Service. This includes investigating allegations of criminal and administrative misconduct by IRS employees, as well as protecting IRS against external attempts to corrupt or threaten its employees. Tom s investigative area of responsibility includes the northern half of Texas, Oklahoma, Arkansas, Mississippi and western Kansas.