During tax season most of us are probably still dreading the moment we have to quit procrastinating, buckle down, and file our income taxes. Coincidentally, it’s also a time that cybercriminals are working overtime to scam home users into giving over their financial data, and even their tax returns. The frequency of attacks only increases as the IRS tax deadline (April 18th this year) looms ever closer.
Don’t Let Tax Season Scammers Steal Your Refund!
According to the IRS, thousands of people have lost millions of dollars and their personal information to tax scams and fake IRS communication in the past few years. In fact, a recent phone scam has been aggressively targeting taxpayers, often members of immigrant populations, in which callers claim to be IRS employees. They use false names and credentials and even spoof their caller ID information to appear more legitimate. The scammers tell their victims they owe money to the IRS and demand it be paid right away through a pre-loaded debit card or a wire transfer. If any victims refuse or sound too skeptical, the scammers threaten them with arrest, deportation, or any number of other downright terrifying legal scenarios.
According to data collected in the 2016 tax season, the IRS saw an approximate 400% surge in phishing and malware incidents, and our own data suggests this number won’t be going down any time soon.
A number of alerts have been issued by the IRS about the fraudulent use of their name or logo by scammers who hope to steal taxpayers’ assets and identity. Regular mail, telephone, fax, emails—scammers are using every phishing tool at their disposal to trick unsuspecting victims, and the proof is in the numbers. According to data collected in the 2016 tax season, the IRS saw an approximate 400% surge in phishing and malware incidents, and our own data suggests this number won’t be going down any time soon.
BOLO (Be on the Lookout)
While the IRS provides a list they call their tax season “Dirty Dozen” scams, here are the top 5 we think you should really watch out for.
Phishing: Taxpayers need to be on guard against fake emails or websites looking to steal personal information. The IRS will never initiate contact with taxpayers via email about a bill or refund. Don’t click on one claiming to be from the IRS. Be wary of emails and websites that may be nothing more than scams to steal personal information.
Phone scams: Phone calls from criminals impersonating IRS agents remain an ongoing threat to taxpayers. The IRS has seen a surge of these phone scams in recent years as con artists threaten taxpayers with police arrest, deportation and license revocation, among other things.
Identity theft: Taxpayers need to watch out for identity theft especially around tax time. The IRS continues to aggressively pursue the criminals that file fraudulent returns using someone else’s Social Security number. Though the agency is making progress on this front, taxpayers still need to be extremely cautious and do everything they can to avoid being victimized.
Return preparer fraud: Be on the lookout for unscrupulous return preparers. The vast majority of tax professionals provide honest high-quality service. There are some dishonest preparers who set up shop each filing season to perpetrate refund fraud, identity theft and other scams that hurt taxpayers.
Fake charities: Be on guard against groups masquerading as charitable organizations to attract donations from unsuspecting contributors. Be wary of charities with names similar to familiar or nationally known organizations. Contributors should take a few extra minutes to ensure their hard-earned money goes to legitimate and currently eligible charities. IRS.gov has the tools taxpayers need to check out the status of charitable organizations.
To stay safe during tax season, you need to first understand what is and isn’t normal. When faced with officials or people with perceived authority, we tend to get nervous and want to do anything they say to avoid getting in trouble. (Think about how you probably tense up when you see a cop pull up behind you, even though you know you weren’t speeding.)
The IRS will never:
- Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail you a bill if you owe any taxes.
- Threaten to immediately bring in local police or other law-enforcement groups to have you arrested for not paying.
- Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.
- Ask for credit or debit card numbers over the phone.
Additionally, it’s important that you pay close attention to email addresses, and never share financial information through email. It is normal that online tax preparation services, such as TurboTax, will require several steps of authentication via a secure connection, and may ask for personal information. Because many modern phishing scams can look almost exactly like the real deal, be sure to go directly to your tax prep service’s website in your browser, rather than clicking the links in any emails. If you’re a Webroot user, we also highly recommend you enable the Webroot Filtering Extension to ensure you know which sites are safe to visit.
Know Your Rights
You have the right to be informed, and also the right to appeal any IRS decisions in an independent forum. Have other questions about your rights as a taxpayer? Visit www.irs.gov/taxpayer-bill-of-rights.