Anthony Sykes & Company

     With so many businesses and employees working remotely, security have become a much greater concern. There are a variety of phishing tactics designed to steal the tax information from employers and tax professionals. This is why Payroll and HR Scams has earned a spot on the Internal Revenue Service ( IRS ) Dirty Dozen list of 2020.        The goals of these scams are accomplished by Business Email Compromise ( BEC ) or Business Email Spoofing ( BES ). There are two well-known scams that are currently being used. A compromised email account is used to send requests for gift cards in different amounts. The other uses the victims email account to change their direct deposit information to an account that the criminal controls. Often fake IRS documents are used.      The specific methods may change over time, but the goals are always the same. If you feel that a request is suspicious, look into it further. There are often little detai...

     A tax professional is entrusted with the most sensitive personal data of the Taxpayer, so it is critical to select the right preparer. Most are honest and provide high-quality service. However, there are some who are intent on committing fraud, harming others, and talking Taxpayers into making choices that they will regret later. These activities have earned a place on the Internal Revenue Service ( IRS ) Dirty Dozen list of 2020.      This year Taxpayers should be especially vigilant because of the COVID-19 pandemic possibly making it more difficult to get in contact with their tax professional. This can leave them vulnerable to “ghost” preparers. They make serious mistakes, expose their clients to tax fraud, and then disappear. They never sign the tax returns they work on. By law they must sign and use their Preparer Tax Identification Number ( PTIN).      They may make promises of large refunds, often by using tax credits that do ...

     Criminals are always finding new ways to get people to believe their scams. This now includes putting money into the bank accounts of Taxpayers. Fake payments with repayment demands is the next entry on the Internal Revenue Service ( IRS ) Dirty Dozen list of 2020.      After stealing a Taxpayers Social Security number or their Individual Taxpayer Identification Number ( ITIN ) and bank account information, a con artist will file a fake tax return and have the refund deposited into their account. Later they will call pretending to be the IRS and claiming there was a mistake and demanding the refund be returned immediately. They will always be told to use gift cards.      Taxpayers have the right to many payment options and the IRS will never demand a specific one. Taxpayers always have the right to question how much in tax responsibility they owe. If you ever receive a surprise phone call about a refund repayment, reach out to your Q...

     Millions of Taxpayers have, or are currently, receiving unemployment funds. Many are doing so for the first time due to the COVID-19 pandemic. Those who are taking part in this compensation need to know that it is taxable income. These benefits will be reported to the Internal Revenue Service ( IRS ) and must be stated on your Federal Income Tax Return for the year it was received. This would include the extra compensation provided by the Coronavirus Aid, Relief, and Economic Security ( CARES ) Act.      To avoid surprises next year, Taxpayers can choose to have tax withholdings applied right now. Usually the agency has their own form for this use. If you do not choose voluntary withholding, estimated quarterly payments can be made. Either way, for those who have received any unemployment compensation this year can expect a Form 1099-G next January. It will list the amount of unemployment income for this year and the amount of tax that was withheld...

     For many years the Internal Revenue Service ( IRS ) has placed impersonating phone calls on the Dirty Dozen list of scams for Taxpayers to watch out for. These calls come in many forms, the most common is one where the criminal claims to be with the IRS and demand immediate payment. The goal is to create fear and a sense of urgency in the victim. The IRS will never surprise anyone with a payment demand.      These kinds of tactics are also called vishing (voice phishing). Calls that threaten arrest or deportation for not paying a surprise tax bill are fake. Often they are recorded messages that give instructions about how to return the call. You will not receive a “robocall” from the IRS . They will also never ask for your financial information over the phone or call to ask you about your Economic Impact Payment. If you have a tax problem, talk to the IRS , or your Qualified Tax Professional .

     The Internal Revenue Service ( IRS ) is sending out a special letter to make sure as many as possible know about the Economic Impact Payment ( EIP ). For US citizens and alien residents with Social Security numbers and low or no earned income, the IRS is sending out letters to encourage them to check their eligibility. Just because they receive a letter does not mean they qualify, but there are many who can receive a payment who may not realize it. Depending on the situation, they may be able to use a tool on the IRS website, or need to file their 2018 or 2019 Tax Return.        This is a situation that is filled with potential for fraud. The letter will have a return address of an IRS office. The IRS will never send a text, email, or make a phone call related to EIP . They will never ask you to open any attachments or share personal financial information. Go directly to the IRS and their website ( www.irs.gov ) if you have any questions,...

     Those who try to impersonate the Internal Revenue Service ( IRS ) often target groups at higher risk than others. Some who are particularly vulnerable are those who have a limited knowledge of English. These scams are used year round which has earned them a place on the Dirty Dozen list.      These scams are often threatening and create a sense of urgency to force the victim to pay a surprise amount of taxes owed. Often the criminals have some real information like an address or part of their Social Security number making the call seem legitimate. The threats of deportation or arrest increase the anxiety for those with limited access to information that would help them to understand how the IRS really communicates. They never use “robocalls” to tell people how to call back. They will never call and ask for personal financial information. Simply hang up on someone asking for these things, you will not go to jail.

It’s never too early to plan for the future. That is especially true when it comes to taxes. People are always looking for the best, legal ways, to reduce what they owe. One way is to take a close look at deductions. There are two choices when it comes to this area, a Taxpayer can Itemize or take the Standard Deduction . To make the right decision, you need to know how much the Standard Deduction will be worth. It changes every year, usually to keep up with inflation. The amount also varies depending on the filing status you choose. For 2020, the Standard Deduction will increase . For example, for someone who will file as “Single” the deduction will rise by $200 to $12,400. If the Standard Deduction is claimed, then most other deductions like property taxes or charitable contributions cannot be claimed. If someone would like to claim deductions in excess of what the Standard Deduction amount is, then they should Itemize . This would require much more detailed information, bu...