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The IRS has consistently warned against falling for misleading advice and scams proliferated on social media, which often promise quick refunds or tax credits that sound too good to be true.

Here, we’ll highlight some of the most pervasive tax scams, why they’re problematic, and how a reputable McAllen CPA can help you navigate tax compliance with confidence.

Common Tax Scams Circulating on Social Media

1. The Myth of the “Self-Employment Tax Credit”

A nonexistent “self-employment tax credit” has made its rounds on social media, enticing self-employed individuals with promises of refunds as high as $32,000. This claim often exploits confusion surrounding a legitimate credit—the sick leave and family leave credit—designed for specific pandemic-related situations in 2020 and 2021.

For context, this credit applied only to self-employed individuals unable to work due to caregiving responsibilities or quarantine mandates. The misuse of this credit often results from ineligible individuals applying it to employee wages instead of self-employment income.

Working with a McAllen CPA ensures your tax filings adhere to legitimate rules and that you avoid penalties stemming from misguided claims.

2. Improper Use of Tax Forms

Unsuspecting taxpayers are often encouraged to misuse official tax forms, leading to fraudulent claims.

• Form W-2 Manipulation: Scammers advise falsifying income and withholding amounts on this form to inflate tax refunds.
• Schedule H (Form 1040): Social media posts have promoted creating fictitious household employees to claim tax refunds for wages never paid.
• Form 8944 Misrepresentation: This form is intended for tax preparers requesting electronic filing waivers, but false claims suggest it can be used for refunds even with outstanding tax balances.

Using forms inappropriately can flag your return for IRS scrutiny. A professional CPA in McAllen can ensure accurate reporting and reduce the risk of costly errors.

3. Fuel Tax Credit Misuse

The fuel tax credit is another area targeted by unscrupulous promoters. This legitimate credit is available only for off-highway business or farming fuel usage, yet scammers often encourage false claims by fabricating receipts or exaggerating fuel use.

The IRS has ramped up its enforcement efforts in this area, and improper claims can result in penalties and interest. Consulting with a McAllen CPA helps you understand which deductions and credits are rightfully yours to claim.

4. Employee Retention Tax Credit (ERTC) Scams

The ERTC, designed to aid employers during the pandemic, became a hotbed for fraud due to its high refund potential. While the credit was legitimate for qualifying employers, the strict eligibility requirements—such as significant revenue losses or pandemic-related shutdowns—disqualified many businesses.

Despite these requirements, scammers aggressively marketed ERTC filing services, promising large refunds regardless of eligibility and charging exorbitant fees. The resulting flood of improper claims led the IRS to pause processing and deny tens of thousands of invalid applications.

The good news? The IRS has introduced voluntary disclosure options to help businesses correct their filings without steep penalties. If your business has concerns about past ERTC claims, a knowledgeable CPA in McAllen can guide you through the process and explore options for compliance.

Why You Should Work with a McAllen CPA

When navigating tax complexities, the stakes are high. Incorrect filings can result in significant fines, interest, and even criminal charges. A McAllen CPA like Burton McCumber & Longoria offers critical advantages:

• Expertise: CPAs undergo rigorous training and certification to ensure they stay up-to-date with federal, state, and local tax laws.
• Personalized Advice: A CPA understands the unique challenges of individuals and businesses in the McAllen area, tailoring strategies to your financial goals and compliance needs.
• Protection from Scams: Working with a professional means you’ll avoid falling prey to misinformation and instead receive accurate advice grounded in current tax regulations.

How to Spot Red Flags on Social Media

To safeguard yourself from tax scams, keep these tips in mind:

1. Verify Credentials: Tax advice should come from qualified professionals, such as licensed CPAs or enrolled agents.
2. Be Skeptical of Overly Generous Claims: Refund or credit amounts that seem disproportionately large are often fabricated.
3. Double-Check Forms: If you’re advised to use an unfamiliar form, verify its purpose with the IRS or your CPA.

Taking the Next Step

Taxes are an unavoidable aspect of financial management, and they can become particularly complicated for business owners, self-employed individuals, and families. While the allure of quick solutions on social media can be strong, the potential risks far outweigh the rewards.

By partnering with a trusted McAllen CPA, you’ll have the peace of mind that comes from knowing your taxes are handled professionally. Whether you’re concerned about past filings or planning ahead for the future, an experienced CPA can provide tailored solutions to protect your financial health.

Get Trusted Tax Guidance

For reliable advice and professional tax services, contact Burton McCumber & Longoria today. Our team of CPAs is committed to helping individuals and businesses in McAllen navigate the complexities of tax compliance with confidence and clarity.