Two Examples Why… You Should Vet Your Tax Professional
NEWS From the Justice Department’s Tax Division
Example 1 – A federal grand jury in Md., returned an indictment charging a tax return preparer with conspiracy to defraud the U.S. and aiding and assisting in the preparation of false returns. During the years of 2012 to 2018 the preparer provided tax preparation services under multiple business names. Along with co-conspirators, the tax preparer allegedly added fictitious or inflated itemized deductions and business losses to clients returns, which fraudulently reduced the clients tax liabilities and increased their refunds. This tax preparer also provided money and office space in exchange for the use of their co-conspirators electronic filing numbers and credentials. Please Beware: Practices like these can costs clients significant fees in back taxes and penalties and provides a good basis for future audits. Obtain references before selecting a tax return preparer. Contact RTW today or visit our website to see what our clients have to say about RTW at www.rtwxxact.com.
Example 2 – The Justice Department also announced that a federal court in Arizona, found a tax preparer guilty of fraudulent tax preparation activities. The civil complaints included adding false business losses and charitable deductions to increase tax returns. This preparer also advised clients not to cooperate in the event of an IRS Audit. The civil complaint also alleges that this tax preparer’s activities have cause significant harm to his clients. Again, it is always best to obtain references before you select a tax preparer.
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(855) 255- 8486 or www.rtwxxact.com
Special $300 tax deduction helps most people give to charity this year – even if they don’t itemize
There is a special $300 Cash Charitable Deduction for any individual regardless of whether you itemize deductions or not for your 2020 tax filing. It must be made to an eligible charity and made in cash donations (cash donations include those made by check, debit or credit card) before 12/31/2020.
Securities, household items or other property are not included. Under this new change, individual taxpayers can claim an “above-the-line” deduction of up to $300 for cash donations made to a charity during 2020. This deduction will lower both adjusted gross and taxable income translating into tax savings for those making qualifying deductions.