IRS - Tax scams

Report IRS Scams: 

• Report IRS Impersonation: https://www.treasury.gov/tigta/contact_report_scam.shtml
• Report to IRS: Report any incident to the Treasury Inspector General for Tax Administration (TIGTA) at 800-366-4484 or at http://www.tigta.gov
• I.D. Theft Issues: Contact IRS Identity Protection Specialized Unit at 800-908-4490 to secure your tax account.

IRS Impersonation Scams

How Do the Scams Work?

• Con artists make unsolicited calls claiming to be IRS officials. They demand that the victim pay a bogus tax bill. They convince the victim to send cash, usually through a wire transfer or a prepaid debit card or gift card. They may also leave “urgent” callback requests through phone “robo-calls,” or send a phishing email.
• Many phone scams use threats to intimidate and bully a victim into paying. They may even threaten to arrest, deport or revoke the driver’s license of their victim if they don’t get the money.
• Scammers often alter caller ID numbers to make it look like the IRS or another agency is calling. The callers use IRS employee titles and fake badge numbers to appear legitimate. They may use the victim’s name, address and other personal information to make the call sound official.
• Aggressive and threatening phone calls by criminals impersonating IRS agents remain a major threat to taxpayers, but variations of the IRS impersonation scam continue year-round and they tend to peak when scammers find prime opportunities to strike.

Stay alert to scams that use the IRS as a lure. Tax scams can happen any time of year, not just at tax time. For more information visit Tax Scams and Consumer Alerts on IRS.gov.  Please visit https://www.irs.gov/uac/tax-scams-consumer-alerts

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 a bill to any taxpayer who owes taxes.
• Threaten to immediately bring in local police or other law-enforcement groups to have the taxpayer arrested for not paying
• Demand that taxes be paid without giving taxpayers the opportunity to question or appeal the amount owed.
• Ask for credit or debit card numbers over the phone.
• Call you about an unexpected refund.

What you can do if you get a call from an IRS imposter:

1. Do not give out any information. Hang up immediately.
2. Contact TIGTA to report the call. Use their IRS Impersonation Scam Reporting web page. Alternatively, call 800-366-4484.
3. Report it to the Federal Trade Commission. Use the “FTC Complaint Assistant” on FTC.gov. Please add "IRS Telephone Scam" in the notes.

For those who owe taxes or think they do:

• Call the IRS at 800-829-1040. IRS workers can help.

Identity Theft Risks

Identity theft is a crime that's anonymous in many cases, but in the case of tax identity theft, the government doesn't have in place the level of protection that many other financial institutions do to prevent fraud.  At this moment, the IRS is one of the weakest links in the financial services world and as a result is highly targeted.  The IRS allows filing of taxes as early as Jan. 19, and prompt thieves will file immediately with the hopes of beating more cautious individuals to their own returns.

What Rebate?  Far more advanced than simply intersecting a rebate check or prepaid card, thieves are stealing year-end statements, W-2s and other income information to file returns on victims' behalf. Americans can legitimately receive their refunds in a variety of ways: direct deposit (often the fastest), loaded onto a prepaid card, or via check mailed to a location of their choosing. Thieves will often choose prepaid cards. Prepaid cards are a source of significant amounts of fraud. If you use tax filing assistant like HR Block or Turbo Tax you could get a refund on a prepaid card.  They're beautiful from a tax ID theft perspective because they're just like cash.

How to Protect Yourself

1. Shred any paperwork not needed for tax preparation.
   
   What to Shred.  Checks from a credit card company offering low annual percentage rates for balance transfers and other pre-approved credit offers should be shredded upon receipt if you don't plan to use them. Once reconciled with corresponding accounts, ATM receipts, canceled checks, and pay stubs can all be shredded.
   
   What to Keep.  Hang on to monthly banking, brokerage account, and credit card statements. Compare the current statement to the previous statement. Verify that there were no mistakes or differences between last month's ending balance and this month's starting balance. Once you've reviewed the statements and addressed any inaccuracies, you can shred them when the year-end statement arrives. Certain papers should be kept for life, including divorce and estate documents and annual retirement plan forms. Per IRS recommendation, keep filed tax returns that don't require additional payments for three years.
    
2. Go Digital.  The best way to minimize year-end paperwork is to minimize paperwork in general. Whenever possible, opt out of credit card offers, request that banks not send blank checks if you don't plan to use them, and choose to receive forms digitally. Sign up for online banking when it's available to eliminate the need for physical checks (as well as envelopes and stamps), and opt to get digital alerts when bills have arrived and payments are due.
   
   Tax returns can also be filed digitally on secure servers, and copies of the completed forms downloaded directly to a personal computer. Users can opt to have their Social Security number partially stricken from the download for additional security.  Be wary of a slow-running computer or out-of-place pop-ups when filing taxes online.
    
3. Be suspicious of any phone calls or emails claiming to be from the IRS, even with the appropriate logos. According to the IRS website: "The IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels."
4. Don't put your return in your office mailbox or in outgoing mail bin at work. When filing taxes by paper, take them directly to the post office and put them right into a postal worker's hands.  Tax returns are usually pretty obvious, and can easily be snatched.
5. Finally, don't get complacent.  Odds are you will file your tax returns without incident this year, but tax ID theft is a growing trend. The best way to avoid being a victim this year, and in future tax seasons, is to remain vigilant.
6. Don’t share your secrets.  Keep your Social Security number and bank account information to yourself if you're contacted online or over the phone—neither your bank nor the IRS will contact you requesting your personal information.
7. Beware of phishing emails.  Phishing occurs when criminals use fake emails and websites of trusted organizations to coerce consumers into sharing personal information. During tax season, fraudsters pose as the IRS. Don’t be fooled—the IRS will never initiate taxpayer contact via unsolicited email to request personal or financial data.
8. Keep an eye out for missing mail.  Fraudsters look for monthly credit card statements, W-2s, tax refunds and other mail containing your financial information. If you don’t receive your W-2s, and your employer indicates they’ve been mailed, or it looks like it has been previously opened upon delivery, contact the IRS immediately.
9. Protect your computer. Make sure the virus protection software on your computer is active and up-to-date, especially if you plan to file your taxes online. 
10. Use online banking to protect yourself.  Monitor your financial accounts regularly for fraudulent transactions. Sign up for text or email alerts from your bank for certain transactions, such as online purchases or transactions of more than $500.
11. Report any suspected fraud to your bank immediately.  If the IRS denies your tax return because one has previously been filed under your name, alert the IRS Identity Protection Specialized Unit.

If your identity has been stolen, the IRS will notify you through the mail that:

• More than one tax return was filed in your name,
• You have a balance due,
• Your income has changed
• Your benefits were reduced or cancelled.

Debt Collection Scams:

• Private collectors for the IRS cannot accept direct payments -- all payments should be made to the U.S. Treasury. The agency will not require specific types of payments such as wire transfers or prepaid debit cards. Scammers prefer these methods because they are hard to trace and can be redeemed anywhere in the world. 
• Unless the IRS has an incorrect address, both the agency and its private collectors should first make contact by mailed letter. 
• Those who owe tax debt but cannot pay in full will be offered an installment plan for up to five years. 
• The same rules on other collectors apply: No calls before 8 a.m. or after 9 p.m. You must be sent a written “validation notice” telling you how much money you owe within five days after first contact. No harassing, abusive or threatening language allowed. 
• Certain tax bills (and therefore phone calls) cannot be handled by private collectors for the IRS: those for taxpayers who are deceased, under age 18, in a designated combat zone, or a victim of identity theft. Debtors currently in audit, litigation or criminal investigation are also off-limits to third-party hired guns.