Beware of Tax Scams, Old and New
Crooks invent new ways to steal your money every tax season — including a brand-new scheme that drops a fake refund in your account. Here's how to spot the IRS scams and protect yourself.
Sometimes it seems as though keeping track of the different ways the crooks are finding to steal your money is a full-time job. That’s why Billshark is here to do the job for you, especially this tax season, and especially because they’ve found a brand new way to bilk Americans.
1 The Phone Call Scam
You already know about the phone calls. An “IRS official” calls and tells you that you owe money to the IRS and that unless you come up with the money immediately, the sheriff will show up at your door to arrest you. They may or may not have personal information about you, offer you their IRS “identification badge number” and phone number, they may even have been able to “spoof” your caller ID to make it look like the call is originating from the IRS. They demand either a wire payment or a prepaid debit card or iTunes cards. They may even claim to be holding a loved one hostage until you pay up.
The tipoff is the demand for immediate payment. The other tipoff is the out-of-the-blue phone call itself. The IRS will write many letters to you through the U.S. Postal Service if you owe money. It will also offer you the chance to either appeal the amount or arrange a payment plan if you do owe.
2 Fake IRS Emails and Phishing
Then there are the emails. Designed to look like they came from the IRS, even sporting the IRS logo, they may tell you that your refund has been delayed pending additional (valuable) personal information from you, that they need to verify your PIN number or filing status . . . anything to make you part with personal data that they can use to steal your identity and/or money. They may also contain spying or computer-damaging malware that will be launched as soon as you click on a link.
Never respond to unsolicited emails from the IRS or any other entity. If you receive any such email, report it to the IRS at phishing@irs.gov.
3 The New Fake-Refund Scam
Scams? They got dozens of ‘em. The latest? Your tax refund—which you haven’t filed for yet—shows up in your bank account. Then a “debt collector” contacts you and demands immediate repayment. The “debt collector” has all your personal information: full name spelled correctly, Social Security number, address, down to the number of your dependents.
How does this happen? The IRS believes cybercriminals either hacked into or installed malware through phishing on tax preparers’ computers, and thus were able to obtain information on thousands of taxpayers, including bank account and routing numbers. They then file fraudulent returns which they have deposited into those bank accounts and obtain the money from the unsuspecting taxpayer.
The IRS also warned of a twist on this new scam, in which a recorded message on the taxpayer’s phone threatens arrest, criminal fraud charges, and a warning that the person’s Social Security number has been “blacklisted.” Recipients are given a case number and phone number to call to arrange payment.
4 What to Do If You're a Victim
Unfortunately, the taxpayer has to spend many hours untangling the mess the thieves create, even if they know enough not to respond to the demands of the scammers.
If you become a victim of this type of fraud, you DO have to return the money to the IRS. You have to close your bank account and notify your bank’s Automated Clearing House (ACH). You have to contact your tax preparer to let them know they’ve been hacked.
To return the money, go to IRS.gov and click on IRS refund return instructions and follow the steps described. It might be possible for the bank to return the refund directly to the IRS, but be sure to call the agency to let them know why the money is being returned. Then go through the steps described on the IRS website IRS Taxpayer Guide to Identity Theft for those who’ve been victims of identity/tax fraud. You’ll have to file a paper version of your tax return with the fraud complaint attached. This will slow your refund while the case is being investigated.
Also see: IRS guidance on identifying real IRS agents to learn how to identify a real IRS agent.
5 File Early and Stay Protected
This is a whole new reason to be sure to file your taxes as quickly as possible if you haven’t done so already before the crooks get in ahead of you.
And be sure to let our sharks sink their teeth into your bills to help you find hundreds, even thousands, of dollars in savings every year.
