Scam of the day – January 4, 2017 – Income tax scams

Income tax identity theft is a major problem that costs taxpayers billions of dollars and can delay your tax refund by many months while the IRS investigates the matter.  While the IRS has gotten somewhat better at discovering income tax identity theft before paying out a fraudulent return, they are still nowhere near as good as they can and should be in preventing this type of crime.

The crime itself is quite simple.  An identity thief uses your Social Security number obtained in any number of ways and files a phony income tax return using a counterfeit W-2 to claim a sizable refund.  If the IRS pays a refund, which they often do, in response to the phony income tax return, the person whose Social Security number was used in filing the phony income tax return will find that the IRS will flag their legitimate income tax return when it is later filed because of it being the second income tax return filed with the same Social Security number.  It takes the IRS 278 days on average to investigate incidents of income tax identity theft causing the victims to have to wait that long before they can receive their legitimate income tax refund.

The vast majority of people file their income tax returns electronically so it should come as no surprise that a scam that is now being perpetrated involves an email you receive that appears to come from the IRS asking you to update your e-filing information including  your Social Security number and bank account information.  Don’t do it.  It is a scam.  The IRS will not communicate with you by emails or text messages.

TIPS

The simplest way to avoid income tax identity theft is to file your income tax return as early in the year as possible in order to beat the identity thief to the punch.  If your legitimate income tax return is filed before the identity thief tries to file an income tax return using your Social Security number, your refund will have already been sent by the IRS.

As for avoiding the phishing emails that appear to come from the IRS, the easiest way to avoid this scam is to follow the rule of never providing personal information in regard to an email until you have confirmed that the email is legitimate and there is a legitimate need for the information to be provided.  In this case, in particular, you don’t need to even bother to look into whether the email is legitimate or not because the IRS will never initiate contact with you by an email so you can ignore it.

 

Scam of the day – October 19, 2015 – Phony IRS phone calls continue to scam taxpayers

Although I have been warning you about this particular scam for years, another warning is warranted in the light of the IRS and the Treasury Inspector General for Tax Administration disclosing last week that since October of 2013 there have been reports of approximately 736,000 people being called by scammers posing as IRS agents demanding immediate payment of overdue taxes by credit card,  prepaid debit cards or wired funds.    Often the scammers threaten their victims with criminal charges, deportation or loss of a driver’s license.  According to J. Russell George, the Treasury Inspector General for Tax Administration, the IRS is aware of about 4,550 victims who have paid more than 23 million dollars to these scammers.  Unfortunately, the real figure of victims and money lost is most likely far in excess of these figure.

TIPS

This scam is easy to spot.   The IRS will never initiate communications with a taxpayer by phone so if someone calls you purporting to be from the IRS in an initial effort to collect overdue taxes, you should hang up because it is a scam.   Even if your Caller ID appears to show that the call is from the IRS, this does not mean that the call actually is from the IRS.  Through a technique called “spoofing” a scammer can make the call appear to be legitimate, but it is not.  The IRS will never demand payment by credit card, debit card, cash card or wired funds through an initial telephone call.  If you think that you really may owe taxes, call the IRS at 800-829-1040 to speak to a real IRS employee.  If you receive a scam call, you may wish to report the call to the Treasury Inspector General for Tax Administration at 800-366-4484.

Scam of the day – April 14, 2014 – The last income tax scam of the season

Tomorrow is April 15th which is the last day for filing your federal income tax return unless you are a procrastinator who has filed an extension.  Identity thieves and scammers love income tax season as it provides them with an opportunity for a wide variety of scams to steal your money.  I have described these scams in numerous Scams of the day.  As the income tax season comes to an end, scammers and identity thieves are busy with one last scam about which I want to warn you.  It starts with you receiving an email that appears to come from the IRS Taxpayer Advocate Service in which you are told that there is a problem with your recently filed federal income tax return and that IRS computers have found errors in your return.  In order to resolve the problem, you are told to click on a link in the email that purports to take you to the IRS Taxpayer Advocate Service website where you are told you will find information about the problem and the name of the taxpayer advocate assigned to your case.  If you click on the link, you will not go to the IRS Taxpayer Advocate Service, which is a real organization.  Instead you will be sent to a legitimate looking, but phony website that will solicit you to provide information that will enable the identity thief behind this scam to make you a victim of identity theft.

TIPS

The easy way to avoid this scam is to remember that the IRS will never initiate contact with taxpayers by email.  If you get an email, text message or phone call purporting to be from the IRS initiating contact about anything, you can be sure that it is a scam.  As a general rule, however, it is important to recognize that whenever you get an email, phone call or text message, you can never be sure of who is contacting you and whether or not they are legitimate.   Therefore never provide information to anyone who contacts you in this manner and do not click on links or attachments in unsolicited text messages or emails which may either be seeking personal information from you to be used to make you a victim of identity theft or will automatically when you click on the link download keystroke logging malware on to your computer that will steal the information from your computer and again use it to make you a victim of identity theft.

Scam of the day – April 15, 2013 – Income tax refund scams

For many procrastinators, today is the day that they finally file their federal income tax returns.  People who are expected a refund will often file sooner than people who owe money, but it still takes the IRS weeks before your refund is processed.  Recently there have been reports of a phony email being circulated that purports to be from the IRS informing you that there has been a problem with your tax return and that you need to provide banking information in order to have your refund deposited electronically into your bank account.  The email looks official and it carries an exact copy of the IRS logo, but it is a phony.  If you look closely at the email address from which it was sent you will notice it reads “administration@ris.com.”  The name IRS does not even appear in the email address.  If you fall for this scam and make the mistake of providing your bank account information, you will find that money will not be deposited into your account.  Rather, your bank account will be emptied by the identity thief who posed as the IRS.

TIPS

It is easy to identify a phony email from the IRS.  If you get an email and it purports to be from the IRS, it is a phony.  The IRS does not initiate communications with taxpayers by email.  In fact, you should never provide sensitive information to anyone or any entity that contacts you by email  unless you are absolutely positive that it is legitimate by confirming the request for information by phone at a phone number you know is accurate or by going to the person or entity’s website and confirm electronically that it is a legitimate request.

For many more tips on how to protect yourself from identity theft, I urge you to pick up a copy of my book “50 Ways to Protect Your Identity in a Digital Age” which you can do by clicking on the picture of the book on the right hand column of Scamicide.

Scam of the day – February 16, 2013 – Latest income tax scam

Every season is scam season, but tax season is a particularly scammed filled time of the year.  The latest income tax scam which has surfaced in Nevada and is making its way across the country begins with a phone call purportedly from the Internal Revenue Service informing you that you are eligible for a refund of $2,000.   You are told that your refund will be processed electronically and that all that is necessary is for you to merely provide your bank account number and routing number for your bank to the IRS agent to whom you are speaking on the phone and your refund will be promptly sent.  Unfortunately, the whole thing is a scam and you are not talking with an IRS agent, but rather a scam artist who will take the information you provide him and steal all of the money in your account.

TIPS

The IRS does not call you by phone or contact you by email to tell you that you are eligible for a refund of any kind.  Further, as I have warned you many times, you should never give any personal information to someone who calls you on the phone unless you are absolutely sure that you know to whom you are speaking and they have a legitimate need for the information.  You can never be sure when you receive a phone call if the person calling you is who they say they are.  If you ever have even the slightest thought that the call might be legitimate, you should merely hang up and call the agency or company, in this case the IRS that is purported to have called you and inquire as to the substance of the call.  I am not a psychic, but I can confidently predict you will be told that the call you received was not from the IRS.