In this article, we’ll delve into tax-related scams that cost individuals and the government billions of dollars annually and offer tips to help you stay vigilant.
Tax season stirs a mix of emotions:
The anticipation of a refund, the stress of gathering documents, and, unfortunately, the looming threat of tax scams. These crafty criminals are always devising new schemes to exploit unsuspecting taxpayers, and you could be their next target.
The dirty tricks: Top tax scams to watch for
Tax scams are like chameleons, with scammers constantly evolving to outsmart their victims. Here are some prominent tactics to be aware of:
The imposter IRS agent
This classic scam involves fraudsters impersonating IRS agents. They call with threats of arrest or jail time unless you pay an imaginary tax debt immediately. Remember, the real IRS never uses scare tactics or demands payment over the phone. These imposters often target the elderly or those new to paying taxes who may not be familiar with IRS procedures.
The “surprise” refund
Many look forward to tax refunds, and scammers exploit this anticipation. You might receive an email with the subject line “tax refund” that looks legitimate, urging you to click a link and fill out a form to claim your refund. However, the IRS never emails people asking for personal and financial information. These emails are always scams designed to steal your data.
Identity theft nightmare
If someone has your name, date of birth, and social security number, they can commit tax identity theft. Scammers file taxes under your name to claim refunds or tax benefits that belong to you. When you try to file your taxes, you’ll encounter an alert about a duplicate SSN. Proving tax identity theft and reclaiming your refund is possible but the process is lengthy and complex.
The shady tax preparer
Many people seek help from tax preparers due to the complexity of filing taxes. Scammers posing as tax preparers promise large refunds and hassle-free filing but may steal your identity and refund while charging you for their services. They might also get you into legal trouble by inflating your income or claiming fake credits or deductions.
W8-BEN for scam
International and non-resident taxpayers should be aware of the w-8ben form, which scammers use to steal information. Fraudsters send letters claiming you need to fill out and return the form, but the fake version asks for details the IRS would never request, like passport numbers and credit card information. Remember, the IRS never sends forms directly to taxpayers.
Final thoughts
Tax season isn’t just about forms and deadlines; it’s also prime time for scammers aiming to steal your money and identity. These criminals cost taxpayers billions each year. Stay vigilant, informed, and cautious during tax season. If you believe you’ve fallen victim to a scam, we’re here to help.
