Tax Season Brings Rise in IRS Scams
Ah, Spring. What a wonderful time of year; plants are growing again, the weather is starting to warm up and tax season is approaching its conclusion. Along with that comes the mad dash to finish your taxes in time for the April 18th deadline. Unfortunately, as the stress of that process ramps up so do the amount of IRS and ta- related phishing scams.
They are most prevalent around this time of year, and much like many other scams, they seek to take advantage of you at this anxious time. Here’s what to look out for, steps you can take to not be scammed, and what to do in case you become a victim of an IRS Tax scam.
What to look out for with IRS and Tax Scams
There are a variety of ways in which scammers will try to convince you they are the IRS including email, phone call/voicemails, text messages and even social media. Many of these scams involve some type of psychological manipulation in order to strip you of the information they want. They do this by making you believe you’ve done something wrong, having you go somewhere that you actually don’t need to or by causing you to panic. When you are unsure of yourself, you are more likely to make mistakes, but if you're familiar with what to look for, you can hopefully avoid any scams that cross your path.
What the scammer is trying to get from you
Scammers could target you for a number of reasons, but the main things they look for in a victim are your personal information, access to your accounts, getting you to pay for fake services or getting you to file taxes for them.
Watch for these commonly used tactics in scams
Contacting you in a ways that the IRS normally doesn’t
Getting you to download something
Providing links and attachments that contain malware
Sending you to a familiar website that is actually fake
Sending you to their unsecure site
Wanting you to pay in prepaid cards, gift cards, or wire transfers
Demanding immediate action
Trying to rush you or make you flustered
Promising something too good to be true
Saying you’ve broken the law in some way
Alleging they’re a trusted source of information
Indicating you have an error in your account
Requesting you call back or you’ll be arrested
Needing your SSN or other private information
Saying you owe money
Types of Scams
Email Scams:
One of the most common ways scammers will contact you is via email. These are scams that enter your inbox and usually contain some type of catchy subject line in order to get you to open the email. From there they will try to get you to open something or send you somewhere that will damage your device or steal your information.
Phone Scams:
It’s hard these days to not answer your phone, especially if you’re expecting an important call, but many times these calls can be the source of vicious scams. These are difficult to avoid because the Caller ID can be changed to look like the IRS but turn out to be a very manipulative scammer on the other end. Because there is often an actual person on the other end, it may be harder to avoid the traps they try to set for you.
Social Media Scams:
Many times scammers look through social media profiles to see what information they can use to target you. A common way they use your public information is by pretending to be one of your contacts, friends or even family in order to convince you to give them the things they’re looking for.
Tax Transcript Scam:
Recently, people have been receiving unsolicited emails about their “tax transcripts” which are documents containing a summary and history of your tax records. Please note that your tax information including your tax transcripts are securely available online with the IRS, and you don’t need an email account to sign up with the IRS.
Stimulus Payment Scams:
Throughout the pandemic, people have been eligible for a variety of stimulus checks provided by the government. Scammers have taken advantage of this to try and access information in the hopes of stealing money from your stimulus check. However, as of late 2021 and early 2022, there have been no stimulus checks to report. Be wary of any form of contact asking you to provide personal information to get access to a stimulus check.
Tax Advocate Scam:
Around this time the inundation of tax service ads and information can be mind numbing. Many tax scammers will try to play off this by pretending to be someone that can help you complete your taxes, and they often promise the biggest return imaginable. Make sure you trust the tax service you use so you don’t get scammed.
Here is a list of other scams the IRS warns about
How to prevent being scammed
The IRS will not contact you via email, phone, voicemail, text or social media
This is the most important thing to know in order to avoid getting scammed by IRS frauds. The only way the IRS will contact you directly is via regular mail from the U.S. Postal Service. If you receive anything besides an official IRS document in the mail, it is more than likely someone trying to commit fraud.
Be careful with your information
Do not allow any information you want private to be put on the internet, because if it is on the internet, someone will be able to find it. This is especially important on social media platforms such as Facebook, Instagram and Twitter where people can take that information and use it in countless dangerous ways. You can also make your accounts private so you have a better grip on who sees your information.
Do not open anything in the email, text, tweet, etc.
Scammers have numerous ways they can attempt to contact you. If you suspect anything you’ve received may be suspicious, DO NOT open it. If you do happen to open it, however, AVOID opening any attachment, clicking on any links or following the instructions they have provided. They most likely lead to something that will give you harmful malware.
Check if the information is authentic
The IRS provides all the documents it uses on its website as a means of transparency. If the information you received looks any different than what’s provided by the IRS, it’s most likely fraudulent. You can go to either of these pages provided by the IRS to see if any of the information has been altered in any way Understanding Your Notice or Letter and Forms and Instructions.
Check if the service you’re using is reputable
Many businesses offer tax help as their main service, each containing numerous resources at their disposal to help you file your taxes properly. In order to not fall for a fake tax advocate, do proper research because the extra time it takes to make sure a business is legitimate will be worth it in the end. The Better Business Bureau is a great resource for verifying the authenticity of any business.
Update passwords and use Multifactor Authentication
Frequently updating your passwords and login information can drastically reduce the risk of your accounts being broken into and your identity being stolen. Another way to further secure your information is to use multifactor authentication which requires multiple forms of authentication. A common type you have probably heard of is 2-factor authentication. For more information on MFA, check out this other article.
Never feel obligated to provide any information
This can be especially difficult or scary to do if it’s over the phone, but you can simply end the call, at any time. If you ever feel like you are being scammed over the phone contact the IRS and provide the phone number used, any number they told you to call and a description of the call. If possible, also provide their name, date of the call, location, and any type of employee identification they provided.
What to do if you’ve been a victim of this type of scam
Immediately report the Issue to the IRS:
The faster you are able to notify the IRS about any potential incident of fraud, the more likely you’ll be to see actual results – although results are not guaranteed. You can contact them via email at phishing@irs.gov. If you lost money as a part of any IRS related scam, report it to the Treasury Secretary General of Taxes. You should also contact the FTC so the information gets to the proper authorities.
In the case of unemployment fraud:
Over the course of the pandemic, more people have become the victim of unemployment fraud. Unfortunately, for many, this is only discovered at tax time, so if you receive an inaccurate 1099-G form, report it to the proper state agency.
Check and Close your accounts:
If you suspect you have been the victim of identity theft as the result of a tax scam, check your credit account for anything that may look suspicious or out of the ordinary. You should also contact your bank and freeze existing accounts as well as prevent new ones from being opened.
An IRS email phishing scam can have devastating effects on a business and its employees. The past several years have seen a marked increase in these schemes and the new way of doing work presents increased challenges for employers trying to guard against these scams. Vulnerabilities created by COVID-19 and work-from-home, have made these types of scams more alluring and potentially rewarding for cybercriminals.
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