IRS to Limit the Number of Direct Deposit Refunds into Single Account

As part of the ongoing IRS effort to combat fraud and identity theft, beginning with the 2015 filing season, the IRS will limit the number of refunds that may be electronically deposited into a single bank account or pre-paid debit card to three. Read more.

Once the limit of three is reached, any subsequent refunds will be switched to a paper check which will be mailed to the taxpayer at the address that is included on their federal return.

If this occurs, the taxpayer will receive a notice informing them they have exceeded the limit of direct deposits that may be made to a single account and that they will receive a paper check within 4 weeks.

It will also prevent tax preparers from obtaining payment of their tax preparation fees by having part of the taxpayer’s refund deposited into their bank account through the use of Form 8888 (Allocation of Refund) or by preparers opening a joint account with the taxpayer. Read more

Click here to read the entire CrossLink Tax Update that includes further information on the IRS's limit on direct deposit refunds into a single account.

Update on IRS Identity Theft Crackdown

The IRS, in conjunction with the Justice Department and other Federal, state, and local agencies, has intensified their efforts at preventing, detecting, and resolving identity theft and refund fraud. Read more

The identity theft and refund fraud effort has involved 734 enforcement actions in January involving 389 individuals. The effort included 109 arrests, 189 indictments and complaints, and 47 search warrants. Read more

In addition, the IRS began a special compliance effort that began on January 28, 2013. IRS auditors and criminal investigators will visit 197 money service businesses to help make sure that these businesses are not assisting identity thieves or refund fraud when cashing checks. These compliance visits took place in 17 high-risk areas identified by the IRS which included: New York, Philadelphia, Atlanta, Tampa, Miami, Chicago, Houston, Phoenix, Los Angeles, San Diego, El Paso, Tucson, Birmingham, Detroit, San Francisco, Oakland, and San Jose. Read more

Click here to read the entire CrossLink Tax Update about the IRS identity theft crackdown.

IRS Update: Reminders for Year End and the Upcoming Filing Season

As we approach the end of 2012 and the start of the 2013 Filing Season, here are some reminders and things to know:

Start of Filing Season

The 2013 Filing Season will open on Tuesday, January 22, 2013. This is the day after Martin Luther King Jr.’s Birthday.

Renewing Your PTIN

If you have not already done so, you must renew your PTIN for 2013 before you begin to prepare 2012 returns. Click here to read more.

Continuing Education for Registered Return Preparers

It is very important to remember that all registered tax return preparers and return preparers with provisional PTINs must complete 15 hours of continuing education by the end of 2012. Click here to read more.

Increased Emphasis on Fraud by IRS

Due to the significant increase in the filing of fraudulent returns and identity theft, the IRS will be increasing their fraud filters for the upcoming filing season. Click here to read more.

Click here to read the entire CrossLink Tax Update that includes further information on reminders for year end and the 2013 Filing Season.