Top Income Tax Tips for Seniors

March 10, 2015

Some things seldom change, and the mad dash to the post office on April 15 is one of them. For millions of Americans, that’s the universal deadline for filing annual income tax returns. (In some cases, such as when April 15 falls on a weekend or a holiday, the filing-date deadline is typically extended to the next business day.)

For tax purposes, the definition of a senior and a retiree differ. A retiree is someone who has finished his or her career of full-time work. A senior, on the other hand, is someone who is 65 years of age or older in the year they are filing taxes.

The IRS has devoted a section of its website to tax information specific to seniors. Highlights include:

  • Life events that may have tax consequences for seniors and retirees. Significant milestones that could impact your tax status include retirement, separation and divorce, and changes in employment.
  • Tips for seniors in preparing their taxes. Information on standard deduction for seniors, taxable amount of Social Security benefits and Credit for the Elderly or Disabled is provided to help seniors avoid tax-filing errors.
  • Free IRS tax-return preparation. Learn more about the Volunteer Income Tax Assistance (VITA) program, which offers free tax help to people who generally make $53,000 or less, people with disabilities, the elderly and limited English-speaking taxpayers. 

Don’t be a scammer’s victim

Scams increase exponentially during tax season. The IRS’ initial contact with a taxpayer is always by mail, not phone, and the IRS never asks for personal tax information over the phone. The IRS also never requests any form of payment – credit cards, prepaid debit cards or wire transfers – during a phone call.

The IRS’ ‘Dirty Dozen’ Tax Scams for 2014

Identity theft

Tax fraud through identity theft topped the 2014 Dirty Dozen list. Identity thieves often used legitimate taxpayers’ identity and personal info – such as name and Social Security Number – to fraudulently file tax returns and claim refunds.

Telephone Scams

The IRS also reported an escalation of telephone scams across the country. Swindlers’ techniques varied. Some callers told their victims that they owed the government money, or they were due to receive a big refund. Other bogus callers threatened to have the victims arrested and their driver’s licenses revoked if they did not immediately pay past-due taxes. In some cases, follow-up callers told people that they were from the local police department or the state department of motor vehicles.

False Promises of Free Money

Scam artists also pose as tax preparers during tax time. Seniors who do not expect to receive large federal tax refunds should be wary of tax preparers who solicit their business by claiming a significant sum of money is due to them. These scammers file returns in a person’s name, and then take the money before the senior realizes a refund was paid.

In cases like these, the timeless rule of thumb “if it seems too good to be true, it probably is” rings true. The bottom line is scam artists who trick victims into making claims for fictitious tax credits, benefits, or rebates charge good money for very bad advice.

Tax Preparer Fraud

Some unscrupulous preparers preyed on unsuspecting taxpayers. The result? Refund fraud or identity theft. Whether you file your own taxes or hire a tax professional to do so, remember that you are ultimately accountable for the information submitted to the IRS. That’s why it’s important to know as much as possible about your tax obligations each year that you file a return.

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