DFW Moms
Posted Friday, Jun. 10, 2011  Print Reprints

D-FW tax preparer charges a bundle, then disappears

An Arlington man says he paid a tax preparer too much to do his tax return. Is he right? I don't know. There are two sides to every story, but I can't find the man who did his tax returns. Of course, that's not a good sign either.

The Internal Revenue Service advises, "Consider whether the individual or firm will be around to answer questions about the preparation of your tax return months, or even years, after the return has been filed."

The storefront operation on Meadowbrook Drive in Fort Worth where Mohammad Shafiq went a few months ago to take advantage of a $69 special has shut down. Then Shafiq saw an April Watchdog column about a Dallas woman who was charged $339 to do a tax return, even though her adjusted gross income was only $1,000.

He can top that. Forget the $69 special. "These guys made $476 from me in less than one hour," he says. Shafiq showed me his tax return, a simple 10-page job.

Shafiq hired a company called Tax Breaks. When he found out the cost, he tried to cancel, but the company wouldn't let him. When he asked for documentation explaining the extra fee, he was told the extra money went for "federal bank transfer fees."

"OK, do you have any documents to show that?" he asked.

"No, we don't have any," he was told.

Shafiq's tax return is signed by Eric Wynn of Tax Pro in Bedford. Calls and letters seeking Wynn for comment went unanswered.

Shafiq can file a complaint with the IRS. (Form 3949-A at irs.gov.)

But the IRS doesn't worry so much about tax preparers who charge a lot. (That's a marketplace decision for consumers, although prices and rates should be clearly posted.) Tax prosecutors usually go after preparers who create false returns and try to cheat the government out of money.

The IRS has found another way, though, to help consumers who want to know more about the backgrounds of tax helpers they hire. The agency has launched a new system this year that requires tax preparers to be licensed, among other requirements.

Congressional leaders who directed the IRS to adopt new rules explained that one goal is to stop fly-by-night tax preparers who set up in storefronts, then go out of business after tax season and can't be found.

The new rules affect 87,000 known tax preparers in Texas. Each must now have a nine-digit Preparer Tax Identification Number. Until this year, the numbers were optional.

Wynn has a number, but right now the IRS won't release information on individual preparers.

Later this year, the IRS will start offering competency tests. In the future, 15-hour continuing education courses will be offered each year.

Tax preparers who go through the program will get a new designation that will help consumers choose wisely: Registered Tax Return Preparer.

Eventually, the IRS promises, consumers will be able to read online about the backgrounds of tax preparers that have registered, passed competency exams and taken classes.

There's another incentive for consumers to pick the right tax preparer. Remember that if the IRS detects a fraudulent return, it's the taxpayer, not the tax preparer, who pays extra taxes, interests and penalties.

The Watchdog column appears Fridays and Sundays.

Dave Lieber, 817-390-7043

Twitter @DaveLieber

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