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Media > Newsletters > Consumer Advocate > February 2020 > Tax Filers: Beware of Scams and “Ghost” Tax Preparers

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Tax Filers: Beware of Scams and “Ghost” Tax Preparers

As millions of Americans gather their paperwork and prepare to file their taxes, consumers should use extra vigilance as scammers continue to steal identities and money.

Recently, the Internal Revenue Service (IRS) issued a warning to avoid “ghost” tax preparers. Under the law, those who are paid to prepare federal returns must sign the return and include their valid Preparer Tax Identification Number (PTIN). However, ghost tax preparers are unethical and refuse to sign their clients’ tax forms, instead instructing them to sign it and mail it on their own.

According to the IRS, ghost tax preparers may also “require payment in cash only and not provide a receipt; invent income to qualify their clients for tax credits; claim fake deductions to boost the size of a refund; or direct funds into their bank account, not the taxpayer’s account.” They may simply want to make some quick cash by promising you a big refund or charging fees based on how much money you get back from the IRS.

To avoid ghost tax preparers, consumers should always check a tax preparer’s credentials before giving out any personal records or information. For example, review information in the IRS’ directory of federal tax return preparers, and consider asking trusted friends and family for referrals. Further, consumers using a tax preparer should never allow that preparer to submit unsigned federal returns and should not submit an unsigned tax return lacking a PTIN themselves.

Other common tax scams targeting individuals and businesses include:
  • IRS impostor scams: This scam generally begins with a phone call claiming you owe back taxes, a penalty or that a warrant has been issued for your arrest. You’re told to call a certain number immediately, and eventually, you’re asked to send money or to provide personal information to resolve the supposed problem.  
  • Tax identity theft: Tax identity theft generally occurs when someone steals your personal information to file a tax return and fraudulently obtain your refund.
  • Business email compromise scam: Ohioans working in human resources, personnel and payroll positions should be aware of W-2 phishing scams. Typically, a human resources or payroll employee receives an email that appears to come from the boss or the head of the organization. The email instructs the employee to send the W-2s of all employees. Although the email may appear legitimate, it’s actually part of a phishing scam attempting to expose employees’ personal information.
Tips to avoid tax scams include:
  • File your tax return promptly: This makes it less likely that an impostor will be able to file a tax return in your name to steal your refund.
  • Don’t respond to threatening calls: If you receive an unexpected phone call from someone who threatens to arrest you for not paying taxes, it’s probably a scam. Don’t respond to the call, and don’t provide payment or personal information over the phone.
  • Don’t pay taxes using gift cards: Con artists often ask people to buy gift cards and then read the card numbers over the phone. Using this information, they can drain funds from the card, making it difficult to trace or recover the money. The real IRS won’t demand that you pay over the phone or by using a gift card.   
  • Protect your personal information: If you file your taxes online, make sure you use a secure internet connection. If you file by mail, take your completed return directly to the post office. Keep sensitive documents in a secure place. Before getting rid of any unneeded documents that contain your Social Security number or other sensitive information, shred them. 
  • Watch out for phishing scams: Be wary of email messages that appear to come from your boss, your financial advisor or your bank, asking you to provide personal information. The message may be part of a phishing scam.
Consumers who suspect an unfair business practice or want help addressing a consumer problem should contact the Ohio Attorney General’s Office at or 800-282-0515.