Posted by UNIVERSAL ACCOUNTING & FINANCIAL SERVICES INC.

Important Tips on How to Deal With Tax Scams

Important Tips on How to Deal With Tax Scams

Even after you file your taxes, phony IRS calls and other nasty scams will still intensify.

You must have already filed taxes because the IRS has been accepting returns since February 12. As you relax a bit and start checking the refund status, don't be too happy. Scammers always work hard to deceive or mislead taxpayers with their personal information and refunds. Sending unwanted text messages with links to phishing sites and using automatic links to try and trick you into providing personal information is something these scammers will try.

The IRS takes tax evasion and scams seriously and does everything possible to alert us. An entire section on the IRS website is devoted to issuing warnings about popular scams and providing strategies to stay off scammers' crosshairs.

Here is a shortlist of some of the most common scams and what you need to do to protect your identity and tax return and deal with it, including reporting the scam to the IRS.


Fake IRS call

How it works: One of the most egregious schemes used each year is that of crooks who appeal and claim to represent the IRS by calling the taxpayers and demanding immediate tax payments. They call from a phone number that appears to belong to the IRS on your caller ID, then move to threaten, harass, and intimidate you into making a hasty decision. They usually require a transfer of funds by gift card or wire transfer. Thieves are spreading this pattern more and more through email and social media.


How to deal with it: You know the IRS will never call you on the phone or come to your home to request immediate payment, including a gift card or wire transfer. Although debt collectors are known to be aggressive, an IRS representative would/should never scold, abuse, or threaten to use immigration agencies or the laws.

If someone who claims to work for the IRS calls you, the IRS says you should write down the number that called you, the name of the person calling you, and then hang up. You can visit irs.gov/balancedue to view your account or call the IRS directly at 1-800-829-1040.

Report a fraudulent call to the IG of the Treasury for Tax Administration by visiting tigta.gov or call 1-800-366-4484. You can also call the Federal Trade Commission at 1-877-FTC-HELP or visit ftc.gov/complaint.


Fake Emails, SMS, or social messages

How it works: Scammers have had years to perfect their email tricks and recently have expanded to texting and messaging on social media. Phishing scams have gotten much more advanced, with astonishingly authentic messages sent from trusted handles and addresses that trick unsuspecting victims into installing malware or exchanging sensitive information.

One of these tactics involves scammers using the IRS logo and name to warn taxpayers about the same scam they are about to make before asking for confidential personal information. Keep in mind that scammers are increasingly targeting taxpayers as well as tax professionals.


How to handle it: Be careful of any info you receive via text, email, or social media that claims to come from the IRS, or any other financial organization. Again, the IRS will never initiate a contact to request for your personal or financial information.

If you receive this message, the Internal Revenue Service says you should send it to phishing@irs.gov. It would be best if you do not reply to the original message.


Surprise refund bait-and-switch

How it works: This is a new on an old scam with a new twist to it. Once criminals have secured your confidential personal information, such as tax forms and social security numbers, they can easily file a fraudulent return on your behalf.

As soon as you get the funds in your bank account, the criminals, pretending to be someone from the IRS or a collection agent, will contact you to request a refund of the money, either by sending it to an address or depositing it into an account.


How to deal with it: Look for an unexpected tax bill, refund, or message from the IRS or your tax preparer about various filings with your SSN. If you receive a wrong refund, don't go out and make a large purchase, the IRS will ask for its money.

If you feel/know that you are a victim, file a complaint with the FTC (Federal trade commission). Ask the major credit bureaus to enter a "fraud alert" on your records and contact the Internal Revenue Service at 1-800-908-4490.


Suspend or cancel your social security number

How it works: Criminals mostly appeal and threaten to suspend or cancel your social security number until your overdue taxes are paid. The scam may look legit because the caller has some of your information, including the last four digits of your social security number. But, make no mistake, it is a scam."


How to deal with it: If someone calls and threatens to cancel or suspend your Social Security number, hang up immediately. If it rings again, do not pick up. Take down the number and report the call on the IRS website or send an email with the subject "IRS phone scam" to phishing@irs.gov. Don't forget to include the phone number, alongside any other vital info in the body of the email.

If you owe Uncle Sam, you can call the IRS at 1-800-829-1040 to review your payment options. Your SSN will not be suspended or canceled.


Scammers' tactics are constantly changing.

The IRS has a dedicated tax fraud website where the agency posts alerts and updates on the current crop of frauds being used. Additional scams that the IRS has issued notifications for include "ghost tax preparers" who charge someone, often based on a large refund, and fail to file the tax return, leaving the client with an income tax return with no refund.

There is also a warning for a tax transcription system targeting companies whose attachment is infected with Emotet malware file attachment.

The most important lesson here is this: If the IRS needs anything from you, you will receive a letter in the mail. You will not receive an email, phone, or text message. However, letters can be forged, so it's best to use official websites and phone numbers.

Along with keeping your tax information from being compromised, it's also a good idea to use a password manager, use two-factor authentication when possible, and learn how to identify robot calls.


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