Podcast Episode 10: Tax Preparers Gone Wild
In this episode, Jerrod Oltmann and I discuss tax preparers gone wild or tax preparers who either fail to file a return themselves or help their clients to avoid paying their taxes.
In our first segment, we discuss the Treasury Inspector General’s report regarding the IRS failure to clamp down on tax preparers who don’t file or pay their taxes. While not as egregious as the amount due from high-income non-filers, tax preparers who fail to file or pay their own taxes or who help their clients avoid paying their correct tax are a very real problem.
In our second segment, we discuss what warning signs you should look for when hiring a tax preparer. Many people are not aware that even if your tax preparer is bad, you are still on the hook for any unpaid taxes, interest and penalties. So it pays to know how you can tell whether or not you are dealing with an honest preparer.
Finally, we discuss how the IRS is using the club of penalties to compel tax preparers to “audit” their clients. With the increase in fraudulent claims of refundable tax credits, the IRS has foisted additional due diligence requirements on tax preparers. Jerrod and I go through the different levels of due diligence and discuss some things tax preparers should look for to avoid trouble from the IRS.
Links to Information Discussed:
- TIGTA Report on Tax Preparer Noncompliance: https://www.treasury.gov/tigta/auditreports/2020reports/202030027fr.pdf
- Questions to ask your preparer to avoid trouble down the road: https://www.irs.gov/newsroom/irs-choose-tax-preparers-carefully-tax-return-preparer-fraud-makes-irs-2019-dirty-dozen-list-of-tax-scams
- Resources regarding tax preparer due diligence: https://www.eitc.irs.gov/tax-preparer-toolkit/welcome-to-the-tax-preparer-toolkit
As always, I’d like to thank Jerrod Oltmann, enrolled agent, for his help is producing this podcast episode. Jerrod is another tax professional who helps people tackle their IRS tax problem. You can read more about Jerrod’s on his bio page at: https://www.jpoea.com/about/
I am Maine’s IRS Problem Solver. My firm helps Maine taxpayers in trouble. If you or someone you know in Southern Maine wants more information on how to resolve your IRS tax problems, please feel free to contact me directly at 207-502-7181 or by filing out my contact form. A Maine tax attorney can help you consider your options.
James D. Wade, Esq.
Law Office of James D. Wade
57 Portland Road, Unit 3
Kennebunk, ME 04043