Washington (Jan. 20, 2003) -- In an update of an annual consumer alert, the Internal Revenue Service urged taxpayers to avoid falling victim to one of the "Dirty Dozen" tax scams. In the new 2003 ranking, several new scams have reached the top of the consumer watch list, including offshore banking and identity theft schemes."With the tax season in full swing, we’re seeing the traditional upswing in tax trickery," said IRS Acting Commissioner Bob Wenzel. "Year after year, con artists across the nation try pulling a fast one on honest taxpayers with different types of miracle tax solutions. Don’t be fooled by the ‘Dirty Dozen’ and other misleading scams. There is no secret way to get out of paying taxes."

At the top of the list is offshore transactions, which some people use to avoid paying income tax. Use of an offshore credit card, trust or other arrangement to hide or underreport income or to claim false deductions on a federal tax return is illegal.

Other scams to watch for include identity theft, phony tax payment checks, slavery reparations, improper home-based businesses, "pay the tax, then get the prize," frivolous protestor arguments, and situations where a phony IRS agent arrives to collect taxes due. Additional scams involve paying an up-front fee to prepare a claim for a refund of Social Security taxes paid during one's lifetime or some other bogus refund, failure to withhold tax from wages, and "borrowing" or "sharing" qualifying children to qualify for the Earned Income Tax Credit.

-- Electronic Accountant Newswire staff

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