(DailyVibe.com) – Each tax season brings with it some stress, some of which can be amplified by the myriad of tax scams that accompany it. Millions of dollars are lost by thousands of people each year, not to mention the many falling prey to identity theft, due to the abundant fraudulent scammers who seek to part taxpayers from their hard-earned money.
It is important to know about several of the most common scams so that you can stay safe.
Scams Involving IRS Impersonation
When someone approaches a person professing to represent the IRS, they may be an imposter. The majority of these scams are conducted over the phone, but they are also common via email, letters or text.
The most typical IRS scam involves tax collection, in which the scammer phones or otherwise contacts the target and claims they are past due on taxes and must pay them right away, occasionally under fear of arrest. They frequently demand payment by wire transfer or preloaded debit card. The IRS will never demand that you settle a past-due sum right away or in a particular way. They might also assert that they have the power to cancel your immigration status or professional licensure. This is not at all true.
Keep in mind that the IRS will never call you out of thin air regarding outstanding taxes. The IRS will not text, email, or use social media to approach you for collections. They also never phone or come by without first sending a notice through the mail. These letters can be manufactured by scammers to look real, but it happens much less frequently.
If you do get a letter, don’t immediately call the number listed. Instead, dial 1-800-366-4484 and ask a real IRS agent if they sent the letter. If you ever do get a call, there is always the possibility that you missed a written notice, but you can easily investigate the validity of the call.
You can ask for the agent’s name, callback number, and IRS identification number, and then hang up and call the IRS at 1-800-366-4484 to verify that the call was legitimate.
It is possible that if you’re facing an audit that you could get real calls, letters, or personal visits from the IRS. However, if you follow all these safety guidelines for communicating with the IRS, you can be confident that your correspondence with them is real.
Tax ID Fraud and Scams
Similar to identity theft, scammers will steal names and social security numbers to file fake returns. The intention is to obtain someone else’s tax return through deception. The person who has been scammed frequently does not notice until they attempt to submit their taxes or the IRS notifies them via a document known as a 5071C.
To reduce the time a thief has to submit a return under your name, submit your taxes as soon as you have all of your annual income forms and tax documents.
A PIN for identity security will also be given to recipients of a 5071C document, which you use to submit your return. Individuals can ask the IRS for a PIN if they are especially worried about identity theft or if they have already experienced it.
Fraudulent Tax Document Email
A document that provides an overview of a precious tax return is called a tax transcript. Using this, you can ask for a credit or specific forms of government aid. A fake tax document file will often be sent in an email by scammers. When accessed, it spreads malware, such as Emotet, throughout the computer and local network. This malware will attempt to access and skim your personal and business information for the scammer.
OIC Tax Scams
Usually, those who incur back taxes can negotiate with the IRS to establish a payment schedule. Offer in Compromise (OIC) mills make ludicrous promises about paying off tax debt quickly and affordably.
The obvious con here is that taxpayers using an OIC Mill will not receive a better deal than a citizen can receive independently, but that the OIC Mills collect fees for doing what a person could do on their own. Those who have more due in taxes than they are able to pay should speak with the IRS immediately. They have programs to assist citizens without needing a for-profit mediator. Also, taxpayers should speak with a trustworthy tax professional if they are unable to complete any paperwork or have questions.
Con artists may also mislead people into believing they qualify for an OIC when they do not, take their money, and give them nothing in return.
Taxpayers should exercise caution this (and every) tax season to prevent typical IRS scams that could steal their money or confidential information. Knowing these common scams will keep you safe and help save your money.
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