As the old adage goes, "If it sounds too good to be true, it probably is." With the tax filing season up and running, it is easy to fall prey to the lure of return preparers who offer to reduce your tax liability significantly or promise that you will receive a large tax refund. Recognizing this as a problem, the Department of Justice and the Internal Revenue Service have issued news releases cautioning taxpayers to be wary of certain tax return preparers. The state of Michigan has also issued guidance on choosing a qualified return preparer. In addition, when facing a tax problem with the IRS or the state of Michigan, those warnings could be extended to firms offering "tax relief."

First and foremost, tax returns, refund claims and various other tax forms and documents submitted to the IRS, are signed under penalties of perjury. Whether the taxpayer has prepared the return or someone has prepared it on his or her behalf, the taxpayer is ultimately responsible for what is reported on that return - be it the amount of income reported, the deductions claimed or the entitlement to certain credits. If the return is found to be erroneous, it is the taxpayer that could be liable for penalties for negligence (20 percent penalty) or fraud (75 percent penalty) and can be referred for criminal prosecution.

When selecting a tax return preparer, taxpayers should do their homework and choose wisely. Make sure the preparer has the proper credentials and qualifications. Be wary of preparers that promise large refunds or claim they can get larger refunds than other preparers. Be cautious of return preparers that base their fee on the amount of the refund you receive and/or require payment in cash only. Regardless of the tax preparer you choose, always review the tax return carefully before signing the return or the electronic filing form. Ask questions if something is not clear. And make sure that the preparer's PTIN is included on the return, the preparer has signed the return and the preparer has provided you with a copy of the return.

If you find that you owe money to the IRS or if your tax return is being audited by the IRS, you may need the assistance of a professional to help you resolve your tax problem. Only tax attorneys, CPAs and enrolled agents can represent taxpayers before the IRS in all matters, including audits, collections and appeals. Of those professionals, only tax attorneys have attorney/client privilege. When you need the assistance of a professional, key factors to look for are experience directly related to the tax issue you are facing, an understanding of your particular circumstances and concerns, and last but certainly not least, integrity.  Be wary of the services offered by, and the promises made by, "tax resolution" companies or "tax relief" firms. Whether the company is a nationwide firm or a local company, these firms prey on taxpayers during their most vulnerable time by promising to resolve their case for "pennies on the dollar," removal of liens and abatement of penalties. As the saying goes, "If it sounds too good to be true, it probably is."           

If you are being audited by the IRS, owe current or back taxes, or are facing criminal charges or civil penalties for tax fraud, having the right attorney representing you and protecting your rights will make a significant difference in your wellbeing and in the resolution of your case.