Every tax season, scammers are notorious for trying to trick taxpayers into giving over their financial and sensitive information. These types of tax scams earn criminals billions of dollars every year. The Internal Revenue Service (IRS) estimates that they paid out $3.1 billion in fake refunds in 2014. That is $3.1 million worth of tax returns that went to tax scammers instead of the correct people due to fraudulent tax scams.
These scams can happen in a few ways. When you attempt to file your returns, you could notice that someone else has filled out a fraudulent one in your name already. Tax scams can also be in the form of a phone call from the tax scammers themselves who impersonate tax officials. Tax fraud is unfortunately very common, but with these tips, you will learn how to ensure you can stay safe from any tax scam.
We think it’s important to highlight 3 specific tax scams to especially watch out for this season!
1. Phishing Scams
Scammers have sent convincing emails that link to conceivable government websites that appear like the IRS or genuine financial websites, but are actually phishing scams. These websites try to trick you into entering your credentials and to verify personal and sensitive information. Falling into this trap could lead to identity theft, and could also lead to falsely filed tax returns.
The best ways to stay away from these types of scams are to ensure you don’t click on any email links if you plan on imputing sensitive credentials. The ZoneAlarm Anti-Phishing solution offers innovative, real-time protection that ensures your data will always be safe. Also, Be sure to always access government and banking websites directly by typing their website into the browser. If you feel as though something is suspicious, contact the organization that is reaching out to you from their contact information on their website, and confirm that these communications with you were legitimate before taking action.
2. Identity Theft and Falsely Filled Tax Returns
If a scammer is able to get access to your personal information, they can use these details to either commit identity theft or file a false tax return in your name. If they have the chance to pull this off, and file your return before you do, they will be the ones that receive your tax refund. There is a process in place to prove that your tax return was filed fraudulently, but it’s best to avoid it in the first place.
The best way to stay away from these types of scams are to be very careful with anyone who contacts you by phone or email claiming to be a representative of the IRS. It is important to know that the IRS does not contact taxpayers directly for this type of information. It’s also good to be sure to file your tax return as soon as you get your W-2 and other tax information. Scammers can’t file a return under your name if you already have.
3. Impersonation Scams
It’s not uncommon that a scammer contacts you and impersonates an IRS or tax official. They might even misrepresent themselves as a trusted tax authority and request personal information. They can contact you through websites, emails or threatening calls. Sometimes they might request that you pay using a strange method, such as a gift cards or pre-paid credit card. If you owe money to the IRS, you will most definitely receive an official bill in the mail first before they contact you. If you’re contacted by the IRS, it will not feel like it is out of the blue or surprising.
Specifically, the IRS states that they will not do these following things. Please keep these points in mind if you get contacted by someone claiming to be the IRS in the future:
- They will not ask for credit or debit card numbers over the phone
- They will not call to demand immediate payment using certain methods, such as a prepaid debit card, gift card or wire transfer
- They will not threaten to immediately bring in local police or other law-enforcement groups that have you arrested for not paying your taxes
- They will not demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe
How do you Report a Scam?
The IRS encourages taxpayers to report suspicious emails related to tax fraud to [email protected]. If you suspect that you have been a victim to identify theft or fraud, it’s best to follow this process as a recovery plan to assist you in taking action. You are also able to report if someone fraudulently reported a tax return in your name, if your information was exposed in a major data breach or for other types of fraud as well. You can also call the IRS at 800-908-4490 if you believe someone has used your social security number to fraudulently submit your tax form.
This tax season it’s important that you remain cautious and protect yourself from tax scams. If you follow these tips you can ensure your security is safe from tax security scams.