Tax Scams on the Rise How to Protect Yourself

Tax scams are fraudulent schemes designed to trick taxpayers into paying money to criminals or disclosing sensitive personal and financial information. These scams can take many forms, including phone calls, emails, text messages, and even in-person visits.

Common Tax Scams in the United States

1. Phishing scams: These involve sending fraudulent emails or text messages that appear to be from the IRS or a tax preparation company, asking for sensitive information such as social security numbers or bank account details.
2. Impersonation scams: Criminals may pretend to be IRS agents or other government officials, and demand immediate payment of alleged tax debts or threaten arrest.
3. Identity theft: Criminals may use stolen personal information to file fraudulent tax returns and claim refunds, or to open new credit accounts in the victim’s name.
4. Charitable scams: Criminals may create fake charities and solicit donations, which are not tax-deductible, but may appear to be so on a fraudulent receipt.

These scams can have serious consequences for taxpayers, including financial losses, identity theft, and legal problems. Victims may also face difficulties with the IRS and may have to spend time and money resolving the issue.

“Taxpayers across the nation face a deluge of these aggressive phone scams. Don’t be fooled by callers pretending to be from the IRS in an attempt to steal your money,” said IRS Commissioner John Koskinen. “We continue to say if you are surprised to be hearing from us, then you’re not hearing from us.”

These callers are threatening everything from police arrest, court action, revoking drivers licenses, and more. They claim many things, from you owing the IRS money to you are due a huge refund. Watch out! Either way they are not above board and are seeking to scam people into directing funds into their own pockets.

To protect themselves from tax scams, taxpayers should be wary of unsolicited phone calls, emails, or text messages, and should not disclose personal or financial information without verifying the identity of the recipient. They should also review their credit reports regularly and monitor their bank and credit card accounts for suspicious activity.

Filing season is when the IRS is seeing a spike in such tax scams and wants you to know what to watch out for.

What You need to Know about Tax Scams

The IRS is warning of an approximate 400 percent surge in phishing and malware incidents so far this tax season.

These emails made to look like legitimate emails from the IRS, making tax payers think they are official communications from the Internal Revenue Service,  other companies within the tax industry, including tax software companies.

“The phishing schemes can ask taxpayers about a wide range of topics. E-mails can seek information related to refunds, filing status, confirming personal information, ordering transcripts and verifying PIN information.”  Warns the IRS.

• Reports are being filed from every area of the country.
• They may show up as emails, texts, or
• These emails even contain links to websites made to look like official IRS.gov sites.
• These sites may also contain malware which can infect one’s computers allowing scam artists to access personal files on your computer or track your keystrokes, gaining access to your online accounts.
• They may ask for Social Security Numbers or other Personal Information.
• when you haven’t received a prior letter from them is bogus.
• You may receive auto-calls also known as robo-calls demanding that you call them back.
• They may make demands that you set up a wire transfer or a prepaid debit in order to complete your (fraudulent) tax payment.

These scammers are experts in apealing to your honesty and integrity and they are bullies. Don’t be fooled by how much information they have about you, their goal is to make themselves sound official. Also watch out for caller ID fakes. Con artists are manipulators who will go out of their way to deceive.

5 Facts to Help you Protect Yourself from Tax Scams

1. The IRS will never call you making demands for immediate payments.
2. They will never call you without first sending you a mailed bill.
3. They will never demand a payment without allowing you an chance to go through an appeals process or question what you may owe.
4.  The officials at the IRS will never demand a specific form of payment, or ask for payment account numbers over the phone.
5. The IRS will not threaten to call local law enforcement.

The best thing you can do when you receive a phone call from someone claiming to be with the IRS without prior knowledge of a tax that is owed is to hang up, and contact the IRS.gov, or the FTC.gov stating that you believe that you have received an IRS Telephone Scam.

• Report to the IRS Impersonation Scam Reporting web page, or call 800-366-4484.
• Report to the Federal Trade Commission, FTC Complaint Assistant on FTC.gov.  Include “IRS Telephone Scam” in the notes.

You may also contact us at 740•374•6942 to review your existing filings, or to file a new claim.

This information is not intended as legal or tax advice. Cowdery Tax and its representatives does not offer legal or tax advice. We offer services for business bookkeeping, payroll, tax payments, and personal tax filings. We share information that is publicly available. Tax laws may change with or without notice that may alter or change the information contained in this publication.