With the April 17 deadline to files your 2017 taxes just days away, procrastinators should be on the look out for myriad potential pitfalls that could make filing taxes much more a headache than they need to be. If you're wondering how to spot Tax Day scams, the IRS has compiled a page of consumer alerts with details of the latest ways scammers might attempt to trick you into giving up your money and personal information. There's an old saying: nothing is certain in life except death and taxes... which should be amended to include tax scams.
The newest scam, according to the IRS, the "Ghost Tax Return Preparer" scam, proves that ghosting doesn't just apply to dating. Apparently your tax preparer can ghost you too, and this sophisticated scam could not only cost you money, it could also prevent you from filing your taxes on time. "A ghost preparer is paid to prepare a tax return but does not sign it as the paid preparer," the IRS warned on its website. "These phantom preparers who won't put their name on the tax return are a warning sign for taxpayers of a potential scam."
There are also phone scams to look out for — and if you think you're too savvy to fall for phone scams, This Is Money reported that people under 25 are the age group most likely to be defrauded over the phone, which certainly makes a solid case for letting some calls for to voicemail. "In 2018 this is set to get worse, especially as only 54 percent of people are savvy enough to never answer calls or text messages if they do not recognize the sender," Lee Boyce reported for This is Money.
Additionally, a The Harris Poll and Truecaller revealed that one in 10 people in the U.S. fell for phone scams between the 2016 and 2017 tax seasons, which resulted in an average loss of $430 per person. "Many fraudsters see tax time as an ideal time to prey on people facing uncertainty or anxiety about getting their tax returns right, which is why they may call and impersonate IRS officials threatening arrest, deportation, eviction or license revocation if taxes are not paid immediately by using a money transfer, loading a prepaid card or purchasing a gift card," The Harris Poll explained on its website.
So, how to protect yourself? There are a few things to remember. One: Careful who you speak to about your taxes. I know taxes can be stressful. However, no matter how stressful your taxes get, or how badly you think you've bungled them, "the IRS doesn't initiate contact with taxpayers by email, text messages, or social media channels to request personal or financial information." It's also important to know that the IRS will never call you without first sending you a notice in the mail.
Sometimes the callers will call from your area code, which is a trick to get you to answer. If you did not receive a notice in the mail from the IRS with some sort of confirmation you can give to the caller, this is a scam. Hang up immediately. "Victims are told they owe money to the IRS and it must be paid promptly through a gift card or wire transfer. Victims may be threatened with arrest, deportation or suspension of a business or driver’s license," the IRS explained on its website. "In many cases, the caller becomes hostile and insulting. Victims may be told they have a refund due to try to trick them into sharing private information. If the phone isn't answered, the scammers often leave an 'urgent' callback request."
No matter how hostile the caller gets, or how threatening the message is, do not call these people back.
Another scam, referred to as the IRS Refunds email scam, is an attempt to steal your private information. "The 'IRS Refunds' scam is a common tactic used by cybercriminals to trick people into opening a link or attachment associated with the email that takes people to a fake page where thieves try to steal personally identifiable information," the IRS noted.
One of the most elaborate scams involves the fraudsters depositing phony tax returns into your back account, and then attempting to claim the money. "After stealing client data from tax professionals and filing fraudulent tax returns, criminals use the taxpayers' real bank accounts for the deposit," the IRS explained. "Thieves are then using various tactics to reclaim the refund from the taxpayers, and their versions of the scam may continue to evolve." If you notice deposits in your account that you did not make, call your bank ASAP to freeze your accounts and change your account numbers. The best way to avoid falling prey to a tax fraudster is to always err on the side of caution.
Additionally, these are a few good tax-related rules to follow, just to be safe:
- Don't open email links from messages you don't recognize.
- Never give out any of your information over the phone or via email.
- Make sure you file your taxes with a licensed professional, or on a trusted website like TurboTax.
- If you do file your taxes online, make sure you're on a website with an "https" prefix versus and "http" one as these are not secure and could be fake sites set up to steal your information.
The IRS even has what's akin to a bill of rights for taxpayers. If you think you're being targeted by a scammer, refer to the Taxpayer Bill of Rights page on the IRS website. If the person is question is not following the outlined protocol, you're totally empowered to say, bye, bye, bye.