The IRS’s annual list of the Dirty Dozen Tax Scams has been released. Taxpayers who use or fall victim to these scams expose themselves to additional taxes, penalties, and in some cases, criminal prosecution. There can also be nontax consequences, such as identity theft, which tops the list of scams again this year. With the identity theft scam, a taxpayer’s personal information is used to file a fake return and obtain a refund. This delays the processing of the legitimate taxpayer’s return and, where applicable, the issuance of a refund.
Other scams include:
Source: IR-2014-16, 2/19/14
A revenue ruling is the Commissioner’s “official interpretation of the interpretation of the law” and generally is binding on revenue agents and other IRS officials. Taxpayers generally may rely on published revenue rulings in determining the tax treatment of their own transactions that arise out of similar facts and circumstances.