(PartiallyPolitics.com) – On Tuesday, the IRS warned taxpayers they could be prosecuted if they filed false tax returns to get higher refunds.
In a press release, the IRS warns taxpayers not to fall for tax scams regarding household employment taxes, the Fuel Tax Credit, or the Sick and Family Credit.
Despite previous warnings, the IRS reportedly discovered thousands of questionable returns claiming credits taxpayers were ineligible to receive.
The agency has decided to delay refunds. Instead, it has requested the taxpayers under investigation provide proof of their eligibility.
Danny Werfel, the IRS Commissioner, suggested the scourge of false tax returns was the result of “scam artists and social media posts” that indicate taxpayers are entitled to “windfall tax refunds” tricking “well-meaning taxpayers.”
Werfel explained the “bad claims” had been discovered during the agency’s “fraud review process.”
He added that those who had “been tricked” would be subject to an “extensive review process” and potentially a long wait for a refund if they’re eligible for one based on other criteria.
In its press release, the IRS detailed that the Fuel Tax Credit is intended for off-highway business and farming use. It added that those who intend to claim the credit should have proof of the business purpose and qualifying business activity. The agency listed purchasing gas for aviation purposes and operating a farm as examples.
Taxpayers had to be self-employed in 2020 and 2021 to claim the sick and family leave credit. However, the agency noted that many individuals were incorrectly claiming the credit “based on income earned as an employee.”
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