Potential Pitfalls

To avoid any difficulties when preparing tax returns:

• Always treat the information used to prepare an individual's income tax return as confidential.
• Canadians have a number that is like a social security number, but it is for their old-age pension. Do not use this number on a U.S. tax return. Canadians often have both U.S. and Canadian social security numbers.
• Many taxpayers erroneously report amounts from Form 1099-MISC, Miscellaneous Income, with wages or other income. Income from Form 1099-MISC, box 7, generally should be reported on Schedule C or Schedule C-EZ and on Schedule SE, Self-Employment Tax. If the income is reported incorrectly, the IRS may later issue a Notice of Proposed Tax Increase for unpaid self-employment tax.
• Be on the alert for the following possible indications of fraudulent activity:
  • Form W-2 that is typed or handwritten or has noticeable corrections
  • Form W-2 from a company that looks different from other Forms W-2 issued by the same company
  • A suspicious person accompanying the taxpayer (who has been observed on other occasions)
  • Multiple refunds directed to the same address or P.O. box
  • Employment or earnings that are a basis for refundable credits, which are not well-documented
  • Similar returns (e.g., same amount of refund, same number of dependents, or same number of Forms W-2)

Notify your site's coordinator if you suspect any fraudulent or unusual activity.