Tax time comes closer by the day, and the folks at the Internal Revenue Service want to offer some advice on choosing the right kind of tax preparer — one who will keep you out of trouble.

Each year, the IRS prosecutes people for fraud involving the preparation and filing of false income tax returns by preparers who claim inflated personal or business expenses, false deductions, unallowable credits or excessive exemptions on returns prepared for their clients.

For example, preparers may manipulate income figures to fraudulently obtain tax credits, such as the earned income tax credit, officials said.

In some situations, the client, or taxpayer, may not even know that the tax return had fraudulent information.

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

The IRS Return Preparer Program focuses on enhancing compliance in the return-preparer community by investigating and referring criminal activity by return preparers to the Department of Justice for prosecution. The IRS can also seek civil penalties against unscrupulous return preparers.

While most preparers provide honest service to their clients, the IRS urges taxpayers to be careful when choosing a preparer — as careful as they would be choosing a doctor or lawyer.

Because the taxpayer is ultimately responsible for all the information on the return, taxpayers should never sign a blank tax form. And they should review the return before signing it and ask questions on entries they don't understand.

Reputable preparers will ask to see receipts and will ask multiple questions to determine whether expenses, deductions and other items qualify. By doing so, they are trying to help their clients avoid penalties, interest or additional taxes that could result from an IRS examination.

Over the past three years, IRS officials initiated about 200 cases each year for investigation of Return Preparer Fraud.

In each of those years, more than 100 people were sentenced and more than 81 percent were incarcerated — which may include prison time, home confinement, electronic monitoring or a combination — at an average sentence of 18 months.

Since 2001, the courts have issued more than 290 permanent injunctions against abusive tax scheme promoters and abusive return preparers.

Reach Robbie Dingeman at rdingeman@honoluluadvertiser.com or 535-2429.