(MONTGOMERY) – With the onset of the tax season, Attorney General Luther Strange warns Alabamians to be vigilant against income tax fraud and he offers tips to keep from falling prey to certain tax preparers with potentially deceptive offers.

“Between late January and early April, when almost all American households have to file an annual tax return, can be open season for unscrupulous tax preparers whose objective is to harm consumers’ bottom line, and identity thieves attempting to steal tax refunds,” said Attorney General Luther Strange.

“Most tax preparers provide honest and reliable services, but unfortunately we have to be on guard for those who do not. Advertisements about tax preparation and filing abound during this time, and some of the ads seen on television, heard on the radio, or read online can be tempting.  Some tax preparation companies claim to be able to get your tax refund money the next day or even before you file. These offers, however, can be deceptively expensive.  Another serious problem is identity theft, with criminals just waiting to steal your personal information and file phony tax returns in an effort to claim the refund due to you.”

Attorney General Strange offers the following tips for consumers to avoid becoming victims of tax schemes:

  • Do it yourself: You can file your own tax return electronically or on paper. Filing online is free with the IRS.
  • You may qualify for free preparation: Lower-income consumers can use free tax preparation software found at www.irs.gov through Free File. If your income is $54,000 or less, you can get free tax preparation assistance at a Volunteer Income Tax Assistance (VITA) location near you.
  • Safeguard your refund:
    • pay your tax preparer before filing – many preparers charge higher fees when deducting the cost of preparation from your refund. Avoid paying extra for this supposed convenience.
    • Avoid refund advances – no one can guarantee to obtain your refund from the IRS faster than you can. Tax refund advances are actually loans from your preparer, and like almost any loan, will cost you additional fees to receive.
    • Consider direct deposit – if you file electronically and choose to have your refund directly deposited into your bank account, the IRS does not charge additional fees and is often able to provide your refund sooner.
  • Responding to tax-related identity theft.  A surprising letter or notice from the IRS, or the rejection of your return filing, could be an indication that your Social Security number was used to file a fraudulent tax return. If you think this may be the case:
    • Contact the IRS immediately
    • Place a fraud alert on your credit reports with: TransUnion, Experian, and Equifax
    • Create an identity theft report at www.identitytheft.gov
    • File a police report

To report suspected consumer fraud or abuse, Alabamians may call the Attorney General’s Consumer Protection Hotline at 1-800-392-5658.  You can also visit the Attorney General’s website at www.ago.alabama.gov and click on “Consumer Protection.”  To file an online complaint, use the link: http://www.ago.alabama.gov/Page-Consumer-Protection-File-a-Complaint-01.

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