Tax Season Is Here And So Are The Tax Scams: What Are The Red Flags?
The Internal Revenue Service (IRS) is reminding taxpayers to protect their personal and financial information throughout the year and watch out for IRS impersonation scams, along with other scams, which try to trick people out of their money.
Tax scams can involve text message, e-mail, and phone scams.
In 2021, there was an increase in the number of text messages that impersonated the IRS. These scams are sent to taxpayers’ smartphones and often referenced COVID-19 and/or “stimulus payments.” These messages often contain bogus links claiming to be IRS websites or other online tools. Other than the IRS Secure Access site, the IRS does not use text messages to discuss personal tax issues, such as those involving bills or refunds.
Taxpayers are reminded to watch out for claims of unemployment or other benefit payments for which they never applied. States have experienced a surge in fraudulent unemployment claims filed by organized crime rings using stolen identities. Criminals are using these stolen identities to fraudulently collect benefits. Because unemployment benefits are taxable income, states issue Form 1099-G, Certain Government Payments, to recipients and to the IRS to report the amount of taxable compensation received and any withholding. Any worker receiving a fraudulent or inaccurate 1099-G should report it to the issuing state agency and request a corrected Form 1099-G. “IRS warning: Scammers work year-round; stay vigilant” www.irs.gov (Feb. 11, 2022).
Commentary
Remind employees that the IRS (and its authorized private collection agencies) will never call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card, or wire transfer. The IRS does not threaten to immediately send in local police or other law-enforcement groups to have a taxpayer or organizational representative arrested for not paying. The IRS does not demand that taxes be paid without allowing the taxpayer to question or appeal the amount owed, nor will it ask for credit or debit card numbers over the phone.
Generally, the IRS will first mail a bill to any taxpayer who owes taxes. All tax payments should only be made payable to the U.S. Treasury and checks should never be made payable to third parties. The IRS also will not send taxpayers messages via social media platforms. Moreover, the official IRS website is IRS.gov. People should be aware of imitation websites ending in .com. This applies to other IRS tools, too, like Free File – they all end in .gov.
For anyone who does not owe taxes and has no reason to think they do, do not give out any information. Hang up immediately. Then contact the Treasury Inspector General for Tax Administration to report the call. Moreover, the IRS does not initiate contact with taxpayers by email to request personal or financial information. The IRS initiates most contacts through regular mail delivered by the United States Postal Service.
Finally, additional fraud prevention steps include not clicking links or opening attachments in unsolicited, suspicious, or unexpected text messages. This could lead to a malware infection on the user’s personal device.