Consequences of tax fraud

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It will cost you more than a guilty conscience if you’re misleading on your tax return.

News 25’s Victoria Bailey spent the day with a certified tax preparer to find out just what that means.

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“They’re just waiting on you to lie and act like you don’t know what they’re talking about, this is your money. You’re supposed to claim it.” It’s a reoccurring issue the IRS faces when tax season rolls around.

Maybe you spent too much at Christmas, maybe you need to catch up on bills, whatever the case Tax Preparer Twila Johnson says it is important to exercise honesty this season. “You don’t want to get audited. If you get audited there’s a chance you’ll be red-flagged for years with an 8862. Once you get that 8862 you can’t get it off your record.”

The 8862 is an audit form that states an individual has been disallowed earn income credit and additional child tax credit. Statistics show one of the most common red flag claims are children. “They already work with social security, food stamps, and Medicaid. Once they run that social they pretty much know that you’re not supposes to file this child because this child, because this child’s address is 1701 Johnson Street. On your tax paper, you got 1819 Philadelphia Street. They already know you can’t prove it so this is where they’re going to hit you. Send me a lease. Send me a birth certificate showing that this is your sister, your brother with your mother’s name on it or your father’s name on it. When you don’t have proof of that, we’re not giving you that money.”



On rare occasions, after the IRS identifies fraud, it can pursue civil or criminal charges. Johnson says this is why it is so important to file properly. “Stay away from $11,000 returns, $10,000 returns. If you did not earn that money stay away from that because that is fraud.  Stay somewhere where people are true to you and they are going to do what’s right on your returns.”