Does anyone have more information for reporting tax fraud to the irs. I prepared 2 individuals taxes for them and agreed to 15 percent for payment they don't want to pay

[Mayhall87]

How should I handle this matter

[xmasbaby0]

Wait---what?   You prepared some tax returns for someone else and want to be paid fifteen percent of ---what----their refund?   Did you use TurboTax to prepare those tax returns?   If so, then the one who is in violation of the terms of service is you.    TurboTax is not available for use by paid tax preparers.   The people who are refusing to pay you for using TT to prepare their returns are not committing tax fraud.    

[Mike9241]

see your own tax lawyer seems you aided and abetted tax evasion.

[fanfare]

Unless Tony Soprano is a very close friend or relative. you should drop the whole thing and forget about it.

@Mayhall87 

[Mike9241]

if you want to report it at your own risk there is form 3949-A

https://www.irs.gov/pub/irs-pdf/f3949a.pdf 

if you want to claim a reward use form 211

https://www.irs.gov/pub/irs-pdf/f211.pdf 

however, I will point out it seems that you were the one that created the situation by preparing the returns so the reward could be denied and you might be visited by IRS special agents who might ask you under penalties of perjury how you came about this info

[TomD8]

@Mayhall87 --

How is this "tax fraud"?  If you provided services to someone and then weren't paid, the legal term is "theft of services".  If you want to pursue this, see a lawyer.  The IRS doesn't care if you were paid or not.  

[Mayhall87]

It's not about whether I was paid mainly it's the fact that after they received the money they let it slip about falsified income and I don't want to get caught up in their schemes and thank you for your time an response

[TomD8]

When the IRS detects a false return, the taxpayer — not the return preparer — must pay the additional taxes and interest and may be subject to penalties.

However, tax preparers can be held liable if it can be proved that they knowingly filed false returns.  See this IRS fact sheet for some examples:

https://www.irs.gov/pub/irs-news/fs-06-16.pdf

[Anonymous_]

I agree with @TomD8 and, further, the standard with respect to preparers is the prohibition of engaging in willful or reckless conduct (per Section 6694).

You might want to take steps to protect yourself in this instance. @Mike9241 set forth the form, et al, and if you are not familiar with further steps (such as a disengagement letter), you might want to consult legal counsel.

[rjs]

@Mayhall87 

You agreed to 15% of what? Of their refund? A tax preparer is not allowed to charge a fee based on the amount of the refund. If that's what you did, then you are violating the rules for paid tax preparers. Your clients should file complaints with the IRS against you.

[Mike9241]

so you are saying when you prepared their returns you didn't know they were falsifying their income but you took a contingent fee for the preparation. IRS regulations involving tax preparers are contained in Circular 230.  One of these other rules (§10.27 of Circular 230) prohibits a tax preparer from charging a contingent fee for the preparation of a return, including refund claims.  therefore, your best course of action is to consult with your own tax attorney.