Tax Scams: How to Spot and Avoid ThemApril 14, 2022
Tax scams can occur for many different reasons, including money, personal information, or a hack into your account. The key to avoiding tax scams is to be educated about the common characteristics of tax scams. The IRS website is a good resource for information about tax scams, and the IRS publishes a list of the “Dirty Dozen” every year. Regardless of the reason, if you’re unsure of the scam you’re experiencing, it’s best to take the time to read the IRS’s warnings and take action immediately.
The first red flag of a scam is a phone call demanding immediate payment. Taxpayers are generally sent a bill in the mail, and the caller will attempt to convince you otherwise. They may also threaten you with arrest or revocation of your license or immigration status if you don’t pay right away. If you’re uncertain of the caller’s intentions, be careful and ask for ID before giving out any personal information.
If you receive a call from the IRS threatening you with arrest, an arrest warrant, or blacklisting, you should be on the lookout for this scam. The IRS will never demand payment over the phone without giving you the chance to question them or file an appeal. If you’ve received a call like this, be sure to check the IRS website to see if it has an option to set up an IP PIN. Usually, these scammers will make bold threats and state that your Social Security number has been suspended.
Another common scam occurs after you’ve received your refund through direct deposit. The scammers pretend to be agents of the IRS and threaten to demand the money via wire transfer or gift cards. Be careful to never send money to agencies claiming to represent the IRS, as the IRS will contact you by phone or email only if the refund is too large. You can also avoid scammers by using the IRS’s website to check whether your refund is legitimate.
The number of calls from the IRS is on the rise, according to the Consumer Protection Division of the Attorney General’s Office. The IRS has a long list of possible scams. Many tech-savvy scammers are able to fake caller ID, which gives them access to personal information. Then they may try to intimidate you into paying a fake tax bill. If you’re concerned about the call, hung up immediately and block the number to avoid getting scammed again.
Another common type of tax scam involves phishing emails. The purpose of these scams is to collect your personal information. Often these scams come in the form of urgent emails or phone calls from an IRS representative. These scams scare you into divulging sensitive information. Once your personal information is stolen, you’re left with an open door to identity theft and other frauds. The IRS has become an easy target for scammers, especially those who are new to the country.
Another common scam involves convincing you to file a bogus return. They often use fake W-2 forms and 1099 forms to manipulate your tax refund by increasing your claimed income or decreasing it. This technique is common during tax season and can be used for more than one type of tax fraud. So it’s important to be vigilant and cautious when dealing with any tax scammer. These people are more likely to target the younger generation, and the chances of them getting away with a large sum of money are higher.
If you’ve fallen victim to a tax scam, you should immediately report it to the IRS. You must fill out a form 14039 to report the scam to the IRS. The IRS website, the FTB, and the Social Security Administration have more information on how to report a tax scam. And remember, if you’ve lost money or identity to a scam, you can always file a complaint with your local police agency.