Tax season is a prime time for scammers to target individuals and businesses with fraudulent schemes designed to steal personal and financial information. The IRS has warned taxpayers about various scams that emerge each year, preying on people’s urgency to file returns or receive refunds. Here are some of the most common tax-related scams to watch out for and how you can protect yourself.
1.) IRS Impersonation Scams
How It Works: Scammers pose as IRS agents, calling or emailing taxpayers and demanding immediate payment for fake tax debts. They often use threats of arrest, deportation, or license suspension to pressure victims into paying.
How to Protect Yourself:
- The IRS never calls, emails, or texts demanding immediate payment.
- If you receive such a call, hang up immediately and report it to the IRS.
- Verify any tax-related notices by contacting the IRS directly at 1-800-829-1040.
2.) Phishing Emails & Fake IRS Websites
How It Works: Taxpayers receive emails claiming to be from the IRS, asking them to click on links to “update their information” or “claim a refund.” These links lead to fake IRS websites that steal sensitive data like Social Security numbers and bank details.
How to Protect Yourself:
- The IRS never initiates contact via email, text, or social media.
- Do not click on any links in unsolicited emails.
- Forward suspicious emails to phishing@irs.gov.
3.) Tax Preparer Fraud
How It Works: Dishonest tax preparers may alter returns to claim fraudulent refunds, steal clients’ personal information, or charge hidden fees.
How to Protect Yourself:
- Use a reputable tax professional. Check their Preparer Tax Identification Number (PTIN) on the IRS directory.
- Never sign a blank tax return.
- Review your return before submission to ensure accuracy.
4.) Identity Theft & Stolen Refunds
How It Works: Scammers file fraudulent tax returns using stolen Social Security numbers to claim refunds before the real taxpayer files. Victims only find out when they attempt to file and their return is rejected.
How to Protect Yourself:
- File your taxes early to reduce the risk of fraud.
- Use an Identity Protection PIN (IP PIN) from the IRS for added security.
- Monitor your tax account by visiting the IRS.gov website.
5.) Fake Charity Scams
How It Works: Scammers set up fake charities and pressure taxpayers into making “donations,” which are actually stolen.
How to Protect Yourself:
- Verify charities using the IRS Tax Exempt Organization Search tool.
- Never donate over the phone without doing research.
- Avoid donating via gift cards, wire transfers, or cryptocurrency—these are red flags.
6.) Social Security & Benefits Scams
How It Works: Scammers claim that your Social Security benefits or tax refunds are in jeopardy due to unpaid taxes, tricking victims into providing personal information.
How to Protect Yourself:
- The IRS and Social Security Administration never suspend benefits over the phone.
- Do not share personal information with unknown callers.
- Report scams to SSA.gov or the IRS.
7.) Ghost Tax Preparers
How It Works: These scammers prepare tax returns but do not sign them as required by law. They often promise huge refunds and disappear after filing, leaving taxpayers liable for errors.
How to Protect Yourself:
- Ensure your preparer signs the return and provides a PTIN.
- Always request a copy of your tax return.
- Be wary of preparers who base their fee on a percentage of your refund.
A Few Final Tips for Staying Safe This Tax Season
- Use Strong Passwords: Protect your tax accounts with unique passwords and enable multi-factor authentication.
- Shred Old Documents: Dispose of tax records securely to prevent identity theft.
- Monitor Your Credit: Check for suspicious activity that could indicate identity theft.
- Stay Informed: Visit IRS.gov for the latest scam alerts and official tax guidance.
By staying vigilant and taking preventive measures, you can protect yourself from tax-related scams and ensure a smooth and secure filing process this season.
-TeCHS