Criminals are always looking for ways to make money at the expense of others. While scams can occur throughout the year, you’re more likely to come across them during tax time. Here are six scams that made the IRS Dirty Dozen.
1. Phone scams
If you randomly receive a call from someone claiming to be the IRS, hang up. There’s been an increase in criminals pretending to be IRS agents seeking payment. Often they will threaten to have you arrested or deported to make you comply. Don’t fall for it. The IRS usually initiates contact by mail if they need to reach you.
Received an email from the IRS out of the blue? Delete it. Although the message might seem legit, it’s probably a setup.
Phishers usually send emails directing you to a website where you’ll be asked to update information such as passwords, credit cards or bank account numbers. The email and website will mimic the appearance of a popular legitimate company but is meant to steal your information. Common things to look for within the email are misspellings, threats and mismatched links. If the email includes any links, rest your mouse on (but don’t click) the link to see if the address that pops up matches what’s shown in the message.
3. Identity theft
Be cautious about unnecessarily sharing your private information. Criminals have been stealing social security numbers to file fraudulent tax returns and claim refunds.
Some techniques used to steal your identity are:
• Attaching storage devices to ATMs to capture your information when you swipe your card.
• Bribing employees who have access to confidential information.
• Going through your garbage looking for bills, credit cards, etc.
• Stealing your wallet or purse.
4. Inflated refund claims
Don’t let greed get the best of you. Be wary of anyone promising big refunds without looking at your documents or charging fees based on a percentage of your refund.
Fraudulent preparers usually target elderly, low income and non-English speaking individuals by making them claim false rebates, benefits or tax credits. In most cases, the fraudulent refund is deposited into the scammer’s account and a large “fee” is deducted before paying their victim. Although filers usually aren’t given a copy of the tax return, they are still responsible for any information that has been filed. Reporting false income amounts could result in losing benefits such as social security and low income housing.
5. Fake charities
Do your research before donating to charities. Some groups have been posing as charitable organizations to bring in donations from unsuspecting victims. They even attempt to blend in by using names similar to well-known charities.
Here are three tips for making charitable donations:
• Don’t give cash. This is the best way to keep your personal information safe.
• Find out about the charities expenses. Lots of real charities pay their execs well and give very little to those in need.
• Check with the IRS to make sure the charity is real.
6. Return preparer fraud
While most tax professionals provide quality service, there are some fake preparers whose only goal is to steal your identity, commit refund fraud or some other scam. Spare yourself the trouble by preparing your next return with ezTaxReturn. We’re an Authorized IRS e-File Provider and go to great lengths to make sure your information remains private, confidential and secure.