Posted: Fri May 06, 2011 8:49 am Post subject: New Report Describes Poor Quality Tax Preparation And Refund
New Report Describes Poor Quality Tax Preparation And Refund Anticipation Check Abuses In New Mexico
Released on: May 06, 2011, 8:14 am
Author: Sarah Dewees, Senior Director of Research, Policy, and Asset-Building Programs
Industry: Non Profit, Government, Financial
LONGMONT, Colorado (May 6, 2011) – Between February 1 and April 18, 2011, First Nations Development Institute conducted 12 "mystery shopper” tests of paid tax preparers in New Mexico. These mystery shopper tests were conducted in communities with a high Native American population and close to Indian reservations. First Nations visited tax preparer sites in Gallup, Grants, Bernalillo, Farmington, and Albuquerque, New Mexico. The goal of the work was to assess the quality of tax preparation services and to test the hypothesis that the tax preparation firms are steering people toward expensive products, such as Refund Anticipation Loans or Refund Anticipation Checks.
This research uncovered several problems with inaccurate, unethical, or unprofessional behavior on the part of tax preparers. “In our small sample of mystery shoppers, it was shocking what we uncovered,” stated Shawn Spruce, a financial education consultant for First Nations. Spruce also shared,“Unfortunately, the companies that our mystery shoppers visited did a poor job preparing even basic tax returns and could have exposed them to serious tax liability. In general, we were startled by the low quality service and the fact that two of these companies automatically signed our shoppers up for expensive Refund Anticipation Checks, even though they could have directly deposited their tax returns into their own bank accounts.”
Michael E. Roberts, president of First Nations Development Institute, stressed the importance of conducting the mystery shopper tests and resulting research on tax preparers.
“This research reinforces what other studies have found,” stated Roberts. “There is a great need for better regulation of tax preparers so that low-income people can hold on to their hard earned tax refunds and avoid expensive and predatory products like Refund Anticipation Checks. It is unfortunate that tax time serves as an opportunity to exploit Native American taxpayers through high fees and unnecessary products that take money out of taxpayers’ pockets.”
On May 4, 2011, Spruce presented the findings in Tax Time Troubles, a First Nations Development Institute report that provides details about predatory, unprofessional, and inaccurate tax preparation firms serving often low income communities in New Mexico. Spruce was the evening keynote speaker at the Effective Asset Building Strategies in New Mexico conference being held at the Indian Pueblo Cultural Center in Albuquerque, New Mexico. This conference was sponsored by Prosperity Works, a nonprofit organization that works to reduce the impact of predatory lending and whose mission is to ensure that every New Mexican has the opportunity, knowledge and relationships to achieve economic prosperity.
For more information about the research report Tax Time Troubles, visit First Nations Development Institute’s website at www.firstnations.org.
Sarah Dewees, Senior Director of Research, Policy, and Asset-Building Programs
First Nations Development Institute
2217 Princess Anne Street, Suite 111-1
Fredericksburg, VA 22401
You cannot post new topics in this forum You cannot reply to topics in this forum You cannot edit your posts in this forum You cannot delete your posts in this forum You cannot vote in polls in this forum