Return Preparer Fraud refers to illegal actions committed by tax return preparers who intentionally falsify information on clients’ tax returns to increase refunds or reduce tax liabilities. This type of fraud can involve inflating deductions, claiming credits that the taxpayer does not qualify for, or fabricating income figures.
Taxpayers often rely on professional preparers to ensure compliance and accuracy in their filings; however, fraudulent preparers exploit this trust for their benefit, often taking a portion of inflated refunds. This behavior is illegal and can lead to severe penalties, including fines and imprisonment for both the preparers and their clients, who may also face audits or criminal charges for knowingly filing false returns.
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