Winter is wrapping up, and Spring is on its way. Whether you’re looking forward to warmer weather, outdoor events, or the beginning of baseball season, there’s one other thing to keep in mind: we’re also in the middle of tax season. And unfortunately, we all need to think about protecting ourselves from tax fraud.
While paying taxes can feel complicated, it’s nothing to be afraid of. Unfortunately, the high-stakes nature of paying taxes has caused scammers to capitalize on the uncertainty that people feel. During tax season, cyber criminals are more likely to attempt to scam you with tax-based intimidation or identity fraud.
Keep reading to learn more about common tax scams and how to best protect yourself this tax season.
Look Out for these Common Tax Scams
Tax scams can change from year to year, but there are a few that seem to pop up during every tax season.
For example, scenario one: A cyber-criminal may call you, pretending they are the Internal Revenue Service (IRS) and demanding you pay your taxes right away or they will arrest you.
Scenario two: A cyber-criminal may send you a phishing email explaining that your taxes are overdue, and you must go to a website or open an attachment to process your taxes.
Of course, it’s impossible to know every way that a cybercriminal may attempt to scam you. But understanding how the IRS communicates and following safe online practices
can help you stay ahead of scams and protect yourself from falling victim to these cyber criminals.
Understand How the IRS Communicates
Though the IRS has come a long way in preventing data theft, identity fraud and criminal tax activity, tax-related crime can never be entirely prevented. But just like you don’t want to be the victim of a scammer, the IRS wants to make sure you understand their practices in order to protect you.
On the IRS Consumer Alerts
webpage, the IRS makes it clear: They only interact with consumers in certain ways. Which means that, if they seem to be communicating with you in a different way, it’s certainly a scam.
“The IRS doesn't initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information.” —IRS.gov
The IRS also makes it clear that they initiate most contact through regular mail delivered by the U.S. Postal Service. In certain circumstances, they may call or come in person to a home or business, but this will generally be after several notices delivered by mail.
How can you know if you’re really interacting with an IRS representative? Any IRS representative will provide two forms of official credentials. They'll share a pocket commission and a HSPD-12
card (PIV credential). You will always have the right to ask for and see these credentials.
Protect Yourself During Tax Time: Don’t Click
If you do receive communication in the form of text messages or emails, the best thing to do is simple: Don’t click. Scammers have been known to send fake tax forms to taxpayers via email.
These forms may be designed to look similar to legitimate tax preparation services such as TurboTax. Some scammers may email PDFs of seemingly-authentic tax forms that have been altered to ask for more personal information, such as your mother’s maiden name or your passport number.
Remember: The IRS will never contact you via email. If something doesn’t seem right, assume it’s a scam. You can always contact the IRS if you aren’t sure. It’s better to be safe than sorry.
File Your Taxes Early
One of the best ways to avoid cyber-crime attacks is by filing your taxes as soon as you can. The earlier you do it, the more secure you can feel that you’ve done your job correctly. And it also gives cyber-criminals less of a chance to steal your identity or tax refund.
That’s because the IRS only allows one tax return per Social Security number per year. By filing your return early, you’re preventing a criminal from using your Social Security number before you do.
Knowing this, scammers often strike early in tax season in the hopes that their would-be victims haven’t yet filed. As soon as you receive all your necessary tax forms and documents from your financial institutions, it’s best to file your taxes as soon as possible. And for future years, remember that you can usually begin to file as early as the last week of January.
Help Stop Scammers by Reporting Suspicious Activity
To help prevent the spread of identity fraud and scammers during tax season, you can help protect yourself and others by reporting anything that seems suspicious.
If you receive a suspicious email, be sure not to click on any links or attachments. Then the next step is to forward the email to firstname.lastname@example.org
in order to report it.
Using that same email, you also can report telephone calls from entities claiming to be from the IRS. Include all information about the fraudulent telephone call in your email, and use the subject line “IRS Phone Scam.”
If you receive a suspicious tax-related text message, you can report it by forwarding the original message to (202) 522-1226, taking care not to click on any links or attachments.
While it may be frustrating and annoying to be targeted by tax scammers, reporting it can make a difference. You may be able to help yourself and others avoid being the victim of a future tax scam.
Stay Financially Secure, All Year Long
The unfortunate reality is that cyber-criminals will probably always exist, no matter what time of year it is. But staying informed about safe online practices and remaining vigilant at all times can help you avoid becoming an easy target for scammers.