by Nisa Islam Muhammad
Staff Writer

WASHINGTON (FinalCall.com)�Tax time is already stress-filled for most Black Americans. A tax scam involving the just-due reparations owed to Blacks is making tax season even more stressful for the IRS and duped taxpayers.

"Once again, African Americans have become the focus of a potentially major crime network involving slavery reparations through false tax claims. These predators mostly target church congregations and the elderly, preying on their frustrations and their feelings of injustice," said Congresswoman Eddie Bernice Johnson (D-Tx), regarding the "tax credit" for reparations scam.

Using the Internet, bogus e-mails are sent with this information:

"As you may know, all African Americans living here in the United States are descendants of slavery, therefore, our government has finally passed a bill to pay all descendants back. The way they are paying us back is through a refund called the �Black Inheritance Tax Refund/40 Acres and a Mule�. When you call this number you�ll give them your name, address, and phone number and they�ll send you out a packet, which includes further details and information on how to receive the refund. I was informed that it will take only two weeks to receive the packet and then two weeks to receive the money."

The IRS, including the agency�s Criminal Investigation Division, has investigated these schemes for years. Numerous court cases illustrate that these reparations claims have no standing in law.

"Promoters are shamelessly preying upon people," IRS Commissioner Charles O. Rossotti said. "These snake-oil salesmen build false hopes and charge people good money for bad advice on reparations refunds. In the end, the victims discover their refund claims are rejected, and their money and the promoters are long gone."

The slavery reparation fraud has been most concentrated in Southern states, particularly in the Southeast, but the IRS is seeing claims in almost every section of the country.

About 45 percent of the claims have been from states served by the Atlanta Service Center (including Florida, Georgia, South Carolina and West Virginia), with about 25 percent from states served by the Memphis Service Center (including Alabama, Arkansas, Kentucky, Louisiana, Mississippi, Nebraska, North Carolina and Tennessee).

In addition, the IRS is seeing signs that promoters have told those seeking reparation claims not to back away from their claims and to submit additional tax returns. Some promoters charge additional money for filing these additional claims.

The e-mail tells readers: "Now, if you know our government I bet they are not expecting a lot of people to call for this refund, and they may be right, because many of us will not be informed of this. Therefore, this is why I am taking it upon myself to pass on this information, so our community will soon be informed through word-of-mouth about what has been owed to our ancestors all these years."

"There are people using reparations to rip people off and turn them against the reparations movement. The National Coalition of Blacks for Reparations in America sent out e-mails a month ago to let people know about this scam," said Wautella Graham, local chair of the Washington, D.C., chapter. "This is a serious issue. We want to let people know not to connect this scam with the real and legitimate movement for reparations for Blacks in America."

Under a new policy effective April 15, the IRS will send a letter warning taxpayers about filing false reparation claims. If the taxpayer refuses to back away from the improper claim, they face a potential $500 penalty for filing a frivolous tax return.

The IRS will notify the filer that the claim has no basis in law, and the agency will offer an opportunity to submit a corrected return or rescind the frivolous claim with no penalty imposed. But if the taxpayer does not agree, the penalty can be assessed.

This change means the category of slavery reparations claims will be treated the same as all other categories of frivolous tax claims, which are subject to the penalty if the taxpayers don�t withdraw the claim after the first tax filing.

Under the old standard, a taxpayer had to submit two slavery reparation claims before the penalty could be imposed.

The IRS chose the April 15 implementation date to provide enough time to alert taxpayers and organizations about the new policy.

The change still gives taxpayers an opportunity to back away from their claim without penalty. But the approach also gives the agency a new tool to help discourage repeat filings and help counter promoters making money off these efforts.

Promoters of these scams frequently warn their clients against contacting the IRS on the pretext that the IRS does not want the public to know about the "credit." This type of advice should be a red flag to taxpayers that there is a problem.

"If the tax benefits sound too good to be true, taxpayers should check them out with a trusted tax professional or the IRS before sharing personal and financial data with strangers," Mr. Rossotti said.

Taxpayers with questions about reparations scams can call the IRS�s toll-free customer service line at 1-800-829-1040. To report suspected tax fraud activity, taxpayers should call 1-800-829-0433.

Currently, there is no law that allows the U.S. government or the IRS to pay slavery reparations or refunds. At one time, after the Civil War, Congress passed a bill to allow slavery reparations in the form of 40 acres and a mule, but that bill was vetoed by President Andrew Johnson and was never enacted into law.