Tax season is upon us and IRS scammers are working overtime to steal your identity and money. So, before you send that rich Saudi Arabian prince half your paycheck, read over these common scams that wreak havoc on Americans every year. It just might save you a pretty penny—or your identity!
Tax Refund Fraud
Over the last few years, thefts of social security numbers have skyrocketed. Crooks have been using the stolen SSNs to file false returns as though they were the person whose identity they stole. The thief will normally file electronically and claim a low income with high deductions to get the most money they can. When the stolen SSN victim tries to file their return, the IRS rejects it because someone has technically already filed as them.
Luckily the IRS does have an easy solution to this rising problem. The IRS offers an Identity Protection PIN which can be used (with your SSN) on your tax return. The six-digit number is a form of 2-step verification that you can opt in to by going to IRS.gov/GetanIPPIN. Once opted in, you will get a new PIN each year. Sure, adding more numbers to an already confusing process might be frustrating, but when it comes to keeping your returns private; you’re better safe than sorry.
Phishing for W-2s
This year cybercriminals have added a new twist to running a successful W-2 email phishing scam that has tricked major companies into turning over copies of W-2 forms for all or their employees. The phishers will impersonate the CEO of the organization with a spoofed email address to ask human resources for the W-2 information. The criminals then use that data to file bogus returns or even sell it online. HR and payroll departments need to be very wary of this scam and be sure to double check the authenticity of all email address asking for sensitive information.
IRS Phone Call Con
In this scenario, a criminal will use a phone spoofing method to make their number appear to be the IRS. They will then act as though you have a surprise tax bill that needs to be paid immediately to the IRS or you’ll face serious legal issues. You’re told to submit payment by money wiring or through prepaid debit cards. The crooks will try to add a level of authenticity to their scheme by sending spoofed IRS emails to further persuade you. Know this: The IRS will NEVER contact you by phone asking for money. They communicate exclusively through snail mail.
And speaking of snail mail…
The Snail Mail Scam
This year the taxes you file look back to 2017, so it’s possible new scams could arise involving the Affordable Care Act (aka Obamacare). Case in point: The snail mail scam. In this scam, you get a fake tax bill in the mail which looks like a legitimate message from the IRS. It asks you to pay the penalty for not having health insurance. The fact that this one comes through mail makes it more likely to trick a lot of people. There are however ways for potential victims to spot and avoid these scams.
Here are a few warning signs to look out for:
•The letter is issued from an address in Austin, TX.
•Says the issue is related to the Affordable Care Act and requests information regarding the most recent year of coverage.
•Lists the letter number in the payment voucher as 105C.
•Requests checks be made out to IRS and sent to the “Austin Processing Center” at a PO box.
The iTunes Trick
The last one is a personal favorite of mine because if you truly believe the IRS would accept ITUNES GIFT CARDS as a means of payment, then I have no sympathy. And yet, it still happens. USAToday reported a 20-year-old college student using her debit card to put $500 on three separate iTunes cards and $262 on a fourth after being deceived by and IRS impersonator. With this scam, criminals instruct you to put money on gift cards and then read them the 16-digit code off the back. This allows quick access to cash in a nearly untraceable manner.
As you can see, there are many scams going around during tax season. But as always, the best defense is a good offense. Do your research! If something seems fishy, (or should I say “phishy”?) (sorry) it probably is!