IRS Criminal Investigation SPECIAL AGENT FELICIA MCCAIN PUBLIC INFORMATION OFFICER (619)

Transcription

1 IRS Criminal Investigation SPECIAL AGENT FELICIA MCCAIN PUBLIC INFORMATION OFFICER (619)

2 Areas of Emphasis for CI Abusive Return Preparers International Fraud Refund Fraud/ID Theft Corporate Fraud Employment Tax Non-Filers Money Laundering Off Shore Voluntary Disclosure Counterterrorism Abusive Tax Schemes

3 Return Preparer Program Common Areas of Abuse Paper Tax Returns RALS/RACS Fraudulent 1040X returns Falsify tax return items for example Sch A, Sch C, EITC, HSH

4 Return Preparer Program Common Areas of Abuse continued Identity Theft including floating SSNs Refund Skimming and Theft Failure to sign returns

5 Return Preparer Program CI has taken an aggressive stance against unscrupulous return preparers this filing season to coincide with the Commissioner s Return Preparer Initiative.

6 IRS Return Preparer Registration Preparer Tax Identification Number(PTIN) Tax Compliance Checks Background Checks IRS Test Continuing Education Practice Rights

7 Overview of Tax Return Preparer Requirements The chart below provides an overview of the various categories of individuals who may prepare federal tax returns for compensation Category PTIN Tax Compliance Check Background Check IRS Test Continuing Education Practice Rights Enrolled Agents Yes Yes Proposals Pending yes 72 hours every 3 years Unlimited Registered Tax Return Preparers Yes Yes Proposals Pending yes 15 hours per Year Limited CPAs Yes Yes Proposals Pending Attorneys Yes Yes Proposals Pending Supervised Preparers Non-1040 Preparers Yes Yes Proposals Pending Yes Yes Proposals Pending No Varies Unlimited No Varies Unlimited No No Limited No No Limited

8 RPP Statistical Comparison FY 2011 FY 2012 FY 2013 Case Initiations Prosecution Recommendations Indictments Convictions Conviction Rate 96.5% 97.2% 97.2% Sentenced Average Months to Serve

9 Return Preparer Program Case Examples April 12, 2013, Steven Martinez, a local Tax Return Preparer, was sentenced to 24 years for Murder for Hire, Witness Tampering, Filing False Tax Returns, ID Theft & Money Laundering

10 Return Preparer Program Case Examples May 22, 2013, a local Tax Preparer, Neil Thomsen was sentenced to 15 years in prison for a massive fraud that involved stealing hundreds of identities and filing false claims with the IRS for more than half a million dollars in bogus tax refunds.

11 IRS Publications for Return Preparers Treasury Department Circular No. 230 Publication 470 Publication 1345 efile Handbook

12 False Form W ABC Company 123 Main Street ANY where, USA 33, , , John Q PuBLIC 456 ELM St Anyplace, Usa Figures are not typed in the same format and are not aligned Incorrect format of the Employer Identification Number (too many digits) Taxpayer name and address do not line up

13 False Form W-2 20,555 10,123 Excessive withholding in comparison to wages Information is missing

14 False Form W-2 Applied for Applied For ABC Company 123 Main Street Anywhere, USA 33, , , John Q Public 456 Elm St Anyplace, USA W-2 with visibly altered money amounts in the federal income tax box Applied For in Employer Identification Number box

15 If You Suspect Fraud: Preserve fraudulent documents so they can be produced when requested by the IRS Publication 3857 Fraudulent returns should not be filed! Contact your local IRS office or complete Form 3949-A available on the IRS website.

16 Identity Theft IRS has a program to assist taxpayers who have been the victim of identity theft. What to do if your tax records were affected by identity theft? If you receive a notice from IRS, respond immediately. If you believe someone may have used your SSN fraudulently, please notify IRS immediately by responding to the name and number printed on the notice or letter. You will need to fill out the IRS Identity Theft Affidavit, Form Contact the IRS Identity Protection Specialized Unit at Additional information can be found at the IRS website. Go to and input Identity Theft in the search box. There you will find numerous articles and web pages specifically tailored to identity theft and your tax information or.

17 Identity Theft Case Examples On September 26, 2013, fifty-five people were indicted in a massive fraud ring involving more than 2,000 stolen identities used to file false tax returns claiming more than $20 million in bogus IRS tax returns (IRS paid out $7 Million).

18 Questions?