Your tax return has been submitted for the year and you haven’t thought about the IRS in months. That is until your phone rings and someone holding themselves out to be a representative from the IRS is threatening to haul you off to jail.
Luckily, that person is not really from the IRS. Why? Well, the most important thing you need to remember about the IRS is — the IRS will NOT initially contact you via email or phone. Initial contact always comes in the form of a letter that you should share with your tax preparer before responding.
Unfortunately though, thousands of people fall victim to IRS scams every year and end up paying millions of dollars to scammers. To help combat this trend, the IRS puts out it’s “Dirty Dozen” list annually. These are the 12 worse tax scams being used to prey upon honest, law abiding citizens.
Here are a few to look out for:
These are emails, often directing you to a website, trying to collect taxes they claim you owe or offering details on how to collect a refund. These emails and websites are typically fake, even if they look exactly like the IRS website, and are designed to steal your personal information.
Impersonators call taxpayers to threaten them with arrest, deportation, license revocation and more. These calls may be from an individual person or a robo-call, but in both cases, the callers are quite aggressive and state they are IRS agents. In some cases, they may have pieces of your personal information, including the last four digits of your Social Security number, but they are not truly IRS representatives.
In these cases, groups pretend to be nonprofit organizations and look to solicit donations. In some instances, these are operated under the guise of well-respected, legitimate nonprofits. Before donating, be sure your money is going to a legitimate charity. If you want to be extra safe, ask for their Employer Identification Number (EIN) and look it up in the IRS’ Tax Exempt Organization Search.
Scammers work year-round to try and get their hands on your personal information. One of the many things they may try to do with this information is to file a tax return for you to obtain a refund. Identity theft related to the filing of a fraudulent tax return using someone else’s Social Security is on the rise. The IRS is working hard to detect this type of fraud, but many cases still occur.
Other scams include tax preparers who try and entice you with large refund offers and convince you to falsify information on the return. Like all things in life, when something seems too good to be true, it probably is.
If you are contacted by the IRS, be skeptical. If you receive a phone call, voicemail or email, you can ignore it, unless you have already been in written communication with the IRS and have agreed to be communicated with in that manner. And, if in doubt, be cautious and talk to your tax preparer before responding. It’s the easiest way to protect your personal information, your credit and your hard-earned dollars.