Welcome back to our two part series on common tax scams in Michigan. As fraud and financial crime defense attorneys, we’ve helped a lot of people over the years who’ve been accused of financial crimes when in fact, all they did was make a mistake. However, we also know that there are numerous people out there who deliberately attempt to steal money from others.
In an effort to help keep our readers safe, we have created this short but relevant list of the four most common tax fraud crimes in Michigan. If you just found this article now, we recommend you spend a few moments getting caught up. If however, you’ve already read the first article in the series, let’s pick up where we left off last time…
How it happens:
It’s frighteningly easy to get ahold of someone’s personal information these days. With so much info available online, it’s not hard to find out a lot of personal information about someone. And once you have the details of their personal life, it’s the work of a few minutes to file a tax return in their name and claim their tax refund!
The facts about identity theft:
According to the Michigan Attorney General’s website, “the increased popularity of electronic filing of tax returns has made it easier for tax identity theft to thrive.” Add to that fact, the amount of information about us that’s available to someone who is willing to search for it, is staggering! There is hardly a month that goes by where we don’t hear about a major data breach. And once your personal info is out there, you have no control over who has it and how they use it.
Identity theft in Michigan:
Remember, ID scammers don’t steal “your” refund money: they steal money from the federal government. Just because you were a victim of identity theft, doesn’t mean you aren’t legally entitled to your tax refund! If you are the victim of identity theft, and someone filed taxes in your name, call IRS Identity Protection Specialized Unit at 800-908-4490 immediately. Report the fraud, and ask for an ID Theft Affidavit Form 1439 so that you can file your taxes and get your refund!
False Income Claims & Padded Deductions:
How it happens:
Claiming you make more than you do allows you to illegally reap benefits you aren’t entitled to, like refundable tax credits. This is called making false income claims. Padded deductions are similar, in that some taxpayers inflate their deductions to get a larger refund.
The facts about false income claims and padded deductions:
Common way that peoples cheat on their taxes to get a bigger return or make themselves eligible for certain benefits, would include:
- Claiming personal expenses as business expenses
- Claiming an exemption for a nonexistent dependent (pretending a certain child lives with you, when really they don’t!)
- Adjusting their income by creating fake 1099-MISC forms to show non-employee compensations
- Exaggerating charitable donations
False income claims and padded deductions in Michigan:
Padding deductions on your state of Michigan or federal income tax return, and misrepresenting your income is likely to trigger an audit! Once the IRS decides to investigate you, there is a good chance you ‘ll be forced to pay back all of the money you tried to steal from the government, along with added fines and fees! In addition, you may be subject to criminal charges which can mean time behind bars in a Michigan or federal prison!
Have you been accused of a financial crime in Michigan?
Have you or a loved one been accused of financial or fraud crimes in Michigan? Have you made a mistake that the IRS has assumed was criminal activity? If so, you’re going to need immediate help from The Kronzek Firm. Our skilled criminal defense attorneys have spent decades defending people in Michigan against accusations of financial criminal activity, and we can help you too! Call 866 766 5245 (866 7NoJail) today to discuss your case with an attorney who can help.