Tax season is in full swing, as are the phone scams that claim to be from the IRS. Scammers are using new tactics, and some will call to say they have your tax return and just need to verify a few details to process their tax return. The scammer will ask you for personal information, such as your social security number or personal financial information, such as your bank or credit card numbers.
IRS Tax Scams
Scammers often change caller ID numbers to make it appear that the IRS or some other agency is calling and impersonating IRS employees, asking the victim to pay a bogus tax bill. They trick the victim into sending money, usually by prepaid debit card or wire transfer. They can also leave "urgent" call requests through "auto calls" over the phone or phishing emails. They can even politely ask taxpayers to verify their identity over the phone. They can use the victim's name, address, and other personal information to formalize the call.
Here is a shortlist of some of the most common phone scams and what you need to do to protect your identity and your tax return, including reporting them 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 to taxpayers and demand immediate payment of taxes. When you get a call from a phone number that appears to belong to the IRS on your caller ID, you may be threatened, harassed, and intimidated 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 Protect Yourself: 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 will never scold, abuse, or threaten to use immigration agencies or the laws.
If someone claiming to work for the Internal Revenue Service calls you, the IRS says you should write down the number that called, the name of the person calling you, and then hang up. You can then call the Internal Revenue Service directly at 1-800-829-1040 or visit irs.gov/balancedue to view your account.
Report a fraudulent call to the Inspector General of the Treasury for Tax Administration by calling 1-800-366-4484 or tigta.gov. You can also contact the FTC (Federal Trade Commission) at 1-877-FTC-HELP or visit ftc.gov/complaint.
The Surprise refund bait-and-switch
How it works: In the IRS words, this is a "new twist on an old scam." Once criminals get hold of your sensitive personal information, such as social security numbers and tax forms, they can easily file a fraudulent return on your behalf.
As soon as the funds reach your bank account, the crooks, pretending to be someone from the IRS or a collection agent, will contact you to request a refund of the illegal money, either by sending it to an address or depositing it into an account.
How to Protect Yourself: Look for an unexpected tax bill, refund, or message from the IRS or your taxpayer about various filings with your Social Security number. If you receive an incorrect refund, don't go out and make a large purchase, old Uncle Sam will ask for his money back.
If you believe you are a victim, file a complaint with the Federal Trade Commission (FTC). Ask the major credit bureaus to enter a "fraud alert" on their records and contact the IRS at 1-800-908-4490.
Cancel or suspend your social security number
How it works: Criminals appeal and threaten to suspend or cancel your social security number until taxes expire. The scam may seem legitimate because the caller has some of your personal information, including the last four digits of your SSN. But, as the IRS says, "Make no mistake – this is a scam."
How to Protect Yourself: If someone calls and warns to suspend or cancel your Social Security number, hang up immediately. If it rings again, do not answer. Write the number and report the call on the IRS website, also send an email with the subject line "IRS phone scam" to phishing@irs.gov and include the phone number, along with any other relevant details, in the body of the email.
If you owe taxes, you can call the IRS at 1-800-829-1040 to discuss your payment options. Your social security number will not be cancelled or suspended.
Fake SMS, emails, or social messages
How it works: Criminals have had years to perfect their email tricks and have recently spread them to text and social media. Phishing scams have gotten much more sophisticated, with incredibly authentic messages sent from trusted addresses that trick victims into exchanging sensitive information or installing malware.
One particularly bold tactic involves scammers using the IRS name and logo to warn taxpayers about the same scam they are making before asking for confidential personal information. Keep in mind that criminals are increasingly targeting tax professionals as well as taxpayers.
How to Protect Yourself: Be careful of any communication you receive via email, text, or social media that claims to be the IRS, a tax professional, or any other financial organization. Again, the real IRS will never initiate a contact to request personal or financial information.
If you receive this message, the IRS will ask you to send it to phishing@irs.gov. Do not reply to the original message.
Scammers' tactics are constantly changing.
The IRS has a dedicated tax fraud website where the agency posts alert 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 for paying their taxes, often based on a large refund, and then fail to file the tax return, leaving the client with the unfiled tax return.
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 fake calls.
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