Tax-filing season is upon us, but it’s like Christmas for cybercriminals.
Each spring, scam artists unleash their annual flood of fraudulent emails, phone calls and text messages designed to steal money or information. Millions of Americans are duped by scammers every year, losing billions of dollars. These scams occur throughout the year but tend to spike during tax filing season.
Taxpayers should be on the lookout for these 10 types of fraudulent activity in coming weeks:
- Phishing emails. Emails purportedly from the IRS demanding payment of a tax bill or requesting personal or financial information are the most common scams. Typically, these emails include a link to a spoofed IRS website designed to get users to enter personal information or submit payments. Tax professionals are also targeted with requests to update information on fake IRS websites.
- Text message scams. Messages referencing a tax bill or refund may also contain bogus links to purported IRS sites. Clicking on these links can expose users to automatically downloaded malware.
- Threatening phone calls. Phone calls or voice mails threatening arrest and prosecution over delinquent tax bills are almost certainly scams. Other phone scams take a softer approach and try to get you to verify personal information.
- Gift card payments. Whether by phone, email or text, scammers posing as IRS agents demand payment for tax bills or penalties in gift cards. Once the taxpayer buys the cards, the scammer will ask for the gift card number and PIN.
- “Help” creating an account on IRS.gov. Scammers offer to help a taxpayer set up an online account with the IRS, only to steal the taxpayer’s personal information. In reality, setting up an account is straightforward.
- Falsified returns. Thieves only need your name, Social Security number and date of birth to file a tax return under your name without your knowledge — typically claiming a large refund. You probably won’t find out about it until you file your taxes and get an alert from the IRS.
- Social Security cancellation threat. In this scam, a criminal threatens to suspend or cancel the victim’s Social Security number if they don’t immediately resolve a tax issue. However, nobody has the authority to suspend, cancel, freeze or revoke your Social Security number.
- Ghost tax preparation. Unscrupulous preparers will charge you to prepare a tax return but decline to sign it before it is filed with the IRS, making it look as if it was self-filed. That leaves them off the hook for any mistakes or fraudulent claims.
- Offer-in-Compromise scam. OICs are a legitimate IRS service that allows taxpayers who meet certain criteria to settle tax debts for less than the full amount. Criminals will offer to assist with the application process for a hefty fee, even if the victim does not meet IRS requirements.
- Unemployment fraud. Scammers may use stolen personal data to fraudulently file for unemployment benefits in your name. You likely won’t discover the identity theft until you receive a 1099-G tax form for unemployment compensation you didn’t receive.
These are just a few of the ways scammers try to exploit our general anxiety about preparing and filing our income taxes. However, there are a few telltale signs of potential fraud. The IRS notes that it will never:
- Request personal or financial information from a taxpayer via email, text message or social media.
- Call unexpectedly about a tax refund.
- Demand immediate payment of a tax bill using methods such as wire transfer or prepaid gift card.
- Demand payment without giving the taxpayer a chance to question or appeal the amount owed.
- Threaten the taxpayer with immediate arrest for nonpayment.
Verteks offers security awareness training to help users avoid these and other scams. Contact a member of our team to learn more.
