HV Ken Posted February 25, 2011 Report Share Posted February 25, 2011 This is when you know you need to get a life! Was having a conversation with another preparer over a meal and the topic of tax fraud came up. We ended up having different views on whether we are REQUIRED to report tax fraud (provable - you have the fraudulant return that was prepared by someone else), or merely SHOULD report it. I read through the Abusive Return Preparer - Criminal Investigation (CI) pages but do *not* see support for the position that we are REQUIRED to report it. Looking for documentation that says we are required - the next meal is riding on this! Thanks. Quote Link to comment Share on other sites More sharing options...
Achmid Posted February 25, 2011 Report Share Posted February 25, 2011 Wasting your time! Know a TP who worked for somebody else and turned in his employer as well as clients. He wanted the supposed reward. Know what happened - NOTHING. Quote Link to comment Share on other sites More sharing options...
Gail in Virginia Posted February 25, 2011 Report Share Posted February 25, 2011 That surprises me - I thought for sure you were going to say he lost his job! Quote Link to comment Share on other sites More sharing options...
Pacun Posted February 25, 2011 Report Share Posted February 25, 2011 That surprises me - I thought for sure you were going to say he lost his job! lol. I like your answer. I don't think we have to report them but we need to tell the TP (tax payer) the consequences of his failure to comply with tax regulations. Quote Link to comment Share on other sites More sharing options...
jainen Posted February 25, 2011 Report Share Posted February 25, 2011 >>provable - you have the fraudulant return<< That may be an element in a potential investigation, but it certainly doesn't prove anything by itself. And in any case you don't have a requirement, or even the ability, to evaluate such evidence--both civil and criminal fraud have rather complicated legal issues. I admit I'm jaded, but when another professional makes an error I suspect it is most likely for the same reasons I make errors myself--the client intentionally or otherwise provides incorrect information. In my experience, when a client is changing preparers he often is changing his story at the same time. Quote Link to comment Share on other sites More sharing options...
Achmid Posted February 25, 2011 Report Share Posted February 25, 2011 That surprises me - I thought for sure you were going to say he lost his job! He is currently working for another tax preparer who knows nothing about his low life activitiy. Quote Link to comment Share on other sites More sharing options...
Catherine Posted February 26, 2011 Report Share Posted February 26, 2011 <snip> ....when another professional makes an error I suspect it is most likely for the same reasons I make errors myself--the client intentionally or otherwise provides incorrect information. In my experience, when a client is changing preparers he often is changing his story at the same time. Jainen -- your statement is one with which I can concur whole-heartedly!! I think we've all seen that. Quote Link to comment Share on other sites More sharing options...
OldJack Posted February 26, 2011 Report Share Posted February 26, 2011 Report it if you think as a licensed preparer you are an agent/employee of the IRS. Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted February 26, 2011 Report Share Posted February 26, 2011 Jainen is right, IMHO, it is impossible to be certain just from looking at a tax return that the preparer KNOWINGLY and DELIBERATELY prepared it fraudulently. Quote Link to comment Share on other sites More sharing options...
HV Ken Posted February 26, 2011 Author Report Share Posted February 26, 2011 Jainen is right, IMHO, it is impossible to be certain just from looking at a tax return that the preparer KNOWINGLY and DELIBERATELY prepared it fraudulently. Well, KNOWINGLY and DELIBERATELY was the case I was arguing. Examples: claiming head of household and a child that is not their dependent to get the EIC (yea, like that happens); claiming ficticious child care expenses; claiming ficticious college expenses to get the AOC, etc., that you can factually verify are false and fradulent. Guess that's the time to use Form 3949A. My question really boils down to if you are certain you are looking at a KNOWINGLY and DELIBERATELY case, are you *REQUIRED* to report it. Quote Link to comment Share on other sites More sharing options...
OldJack Posted February 26, 2011 Report Share Posted February 26, 2011 >>are you *REQUIRED* to report it.<< NO. Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted February 26, 2011 Report Share Posted February 26, 2011 No, there is no requirement to do so. We do not work for the IRS. Quote Link to comment Share on other sites More sharing options...
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