Tax season is here, and while millions of people are filing their returns, scammers are on the prowl looking to steal personal information, refunds, and financial data. Tax scams come in many forms, from phishing emails to fraudulent phone calls, and they can cost unsuspecting taxpayers thousands of dollars.
In this guide, we’ll help you identify, avoid, and report tax scams so you can protect yourself and your finances. Let’s break it down into easy-to-follow steps.
Beware of Tax Scams
| Key Points | Details |
|---|---|
| Common Tax Scams | Phishing emails, impersonation calls, refund fraud, fake tax preparers |
| How to Avoid Scams | Verify IRS contacts, use trusted tax preparers, protect personal info |
| Reporting Scams | Forward emails to [email protected], report calls to TIGTA (1-800-366-4484) |
| IRS Official Website | www.irs.gov |
| IRS Identity Protection PIN | Protects against tax identity theft by preventing unauthorized tax returns (Get Your PIN) |
Tax scams are becoming more sophisticated but staying informed and vigilant can protect you from fraud. Always verify IRS communications, use trusted tax preparers, and report suspicious activity immediately. By taking these steps, you can safeguard your financial well-being and personal information.
Understanding Tax Scams
Tax scams are deceptive schemes designed to steal personal information, tax refunds, or trick individuals into paying money under false pretenses. Scammers often pose as IRS agents, tax professionals, or refund processors to trick unsuspecting victims.
Why Are Tax Scams So Common?
- Tax season is a time of high financial activity, making it a prime target for fraudsters.
- Many taxpayers are unfamiliar with IRS procedures and may believe scammers’ false claims.
- Digital communication (emails, texts) makes it easier for criminals to impersonate officials.
Common Tax Scams and How to Spot Them
1. Phishing Emails and Text Messages
Phishing scams involve fraudulent emails or text messages pretending to be from the IRS, banks, or tax software companies.
Red Flags:
- Emails or texts claiming you need to “verify” personal information.
- Suspicious links or attachments that could contain malware.
- Grammar and spelling errors in messages.
How to Stay Safe:
- The IRS never initiates contact via email, text, or social media.
- Do not click on links or download attachments from unknown sources.
- Forward phishing emails to [email protected].
2. IRS Impersonation Phone Calls
Scammers often call taxpayers, pretending to be IRS agents demanding immediate payment for “unpaid taxes.”
Red Flags:
- Threats of arrest, deportation, or license suspension.
- Requests for payment via gift cards, wire transfers, or cryptocurrency.
- High-pressure tactics demanding immediate action.
How to Stay Safe:
- The IRS will never call to demand immediate payment over the phone.
- Hang up and report scam calls to the Treasury Inspector General for Tax Administration (TIGTA) at 1-800-366-4484.
3. Fake Tax Preparers (Ghost Preparers)
Some fraudsters pose as tax professionals to steal personal information or charge inflated fees.
Red Flags:
- The preparer refuses to sign your return (a sign of a “ghost preparer”).
- They guarantee huge refunds without reviewing your tax documents.
- They request payment as a percentage of your refund.
How to Stay Safe:
- Use licensed tax preparers with a Preparer Tax Identification Number (PTIN).
- Check the IRS Directory of Federal Tax Return Preparers.
- Never sign a blank tax return.
4. Fake Tax Refund or Stimulus Scams
Scammers send letters, emails, or texts claiming the IRS has recalculated your refund and that you must verify your information to receive it.
Red Flags:
- Unexpected messages about additional refunds or stimulus payments.
- Requests for banking details or Social Security numbers.
- Fake IRS letters with official-looking logos but suspicious URLs or phone numbers.
How to Stay Safe:
- Verify refund claims on the official IRS website: www.irs.gov/refunds.
- Never share sensitive information over email or text.
How to Protect Yourself from Tax Scams
Best Practices for Avoiding Tax Scams
- Verify IRS Communications: The IRS never calls, texts, or emails out of the blue. Any unexpected request for information is a scam.
- File Taxes Early: The sooner you file, the less time scammers have to file a fraudulent return in your name.
- Use Strong Security Measures: Enable two-factor authentication on tax software and use a secure password manager.
- Shred Financial Documents: Don’t throw away tax documents without shredding them first.
- Monitor Your Tax Records: Check your IRS account regularly at www.irs.gov/account for any unauthorized activity.
- Get an Identity Protection PIN: The IRS provides Identity Protection PINs (IP PINs) to prevent scammers from filing a return in your name.
How to Report Tax Scams
If You Suspect a Tax Scam, Take These Steps:
- Phishing Emails: Forward them to [email protected].
- Phone Scams: Report to TIGTA (1-800-366-4484) and the Federal Trade Commission (FTC) at www.ftc.gov/complaint.
- Fraudulent Tax Preparers: File a complaint using IRS Form 14157.
- Identity Theft: If someone has filed a fraudulent return in your name, complete IRS Form 14039 (Identity Theft Affidavit).
Frequently Asked Questions (FAQs)
1. How do I know if the IRS is really contacting me?
The IRS primarily communicates through mailed letters. They do not initiate contact via email, text, or social media.
2. What should I do if I receive a scam call from someone claiming to be the IRS?
Hang up immediately and report the call to TIGTA (1-800-366-4484).
3. Can I get a refund if I was scammed?
If money was stolen via a scam, contact your bank or credit card company to dispute fraudulent transactions. Unfortunately, the IRS cannot reimburse lost funds.
4. How can I check if someone filed a tax return in my name?
Visit www.irs.gov/account to monitor your tax records.
5. Are tax scams increasing?
Yes. The IRS warns of an annual rise in tax scams, especially during peak tax season.
