Tr?id=566623520170033&ev=PageView&noscript=1

IRS Highlights Tax Scams Targeting High-Net-Worth Individuals

Posted on June 25th, 2024 at 10:18 AM
IRS Highlights Tax Scams Targeting High-Net-Worth Individuals

From the desk of Jim Eccleston at Eccleston Law

The Internal Revenue Service (IRS) has concluded its annual Dirty Dozen campaign, spotlighting the most egregious tax scams. According to WealthManagement.com, this year's focus includes schemes aimed at high-net-worth individuals (HNWI).

Fake Charities
The IRS warns that deceitful organizations often exploit wealthy individuals' generosity, especially during natural disasters or tragic events. These fake charities mimic legitimate ones, using similar names, emails, or fake caller IDs to solicit donations and personal information. The IRS emphasizes that only donations to legitimate tax-exempt organizations qualify for tax deductions. Individuals should verify a charity's legitimacy using the IRS Tax-Exempt Organization Search (TEOS) tool to avoid falling victim.

Illegal Tax Schemes and Improper Deductions
The IRS also cautions against tax schemes promoted by shady practitioners. Theseschemes often promise unrealistic tax reductions through aggressive strategies, such as inflated art donation deductions or abusive use of charitable remainder annuity trusts. For example, some promoters encourage purchasing art at a discounted price, promising significant tax deductions for inflated appraised values upon donation. The IRS has art appraisers to determine true valuations and warns against promoters suggesting annual art donations with guaranteed deductions.

Additionally, the IRS highlights the misuse of trusts to eliminate capital gains and schemes that defer gain recognition on property sales. Such practices can expose taxpayers to severe civil or criminal penalties.

Unscrupulous Practitioners
Finally, WealthManagement.com reports on the IRS advice related to unscrupulous practitioners. Specifically, the IRS warns HNWIs to steer clear of practitioners promoting fraudulent offshore schemes or fake tax strategies. One notable scam involves "ghost preparers" who do not sign the tax returns they prepare. These preparers often charge high fees or steal refunds and then disappear, leaving taxpayers to face the repercussions.

 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law, irs

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

If the regulators are after you, and are trying to make a case against you, and you are going to contest their allegations against you, make sure you have the best securities industry defense lawyers, Eccleston Law Firm. My case was spun into a combination of penalties including fines, cash settlements, CE courses and suspension. They were the best I have seen in action. When all was said and done, they had done their magic, my situation was negotiated and settled with a simple "letter of caution" and a case closed without action. It is the most important legal business decision you will ever make, make it Eccleston Law.

Rick R.

LATEST NEWS AND ARTICLES

L
May 21, 2026
Edward Jones Faces Federal Privacy Lawsuits Over Alleged Data Sharing With Tech Companies

Edward Jones is facing multiple lawsuits alleging that the firm improperly shared clients' personal and financial information with third-party technology companies for targeted advertising purposes, according to reporting by Financial Planning.

1779287606 Law
May 20, 2026
FINRA Sanctions Ameriprise for Supervisory Failures in Variable Annuity Exchanges

The Financial Industry Regulatory Authority (FINRA) has fined Ameriprise Financial Services and ordered restitution to resolve allegations that the firm failed to adequately supervise certain variable annuity exchange recommendations.

1779216500 Law
May 19, 2026
SEC Fines Ally Invest Advisors Over Undisclosed Robo-Advisor Conflict

The Securities and Exchange Commission (SEC) imposed a $500,000 penalty on Ally Invest Advisors after finding that the firm failed to disclose a material conflict of interest tied to its Cash-Enhanced robo-advisor accounts.