The Spring-like weather this week could convince someone that it is April. Bears might not be coming out of hibernation for a few more weeks, but another creature is: tax scammers - and they can be just as scary. Identity theft is the crime of choice these days. Recent reports state that street gangs are starting to shift to white collar crime. Tax season is essentially harvest time for these criminals. Below are some tips on keeping your identity, and your refund, safe.
The IRS Only Communicates by U.S. Mail:
A common scam is for criminals to pose as IRS agents over the phone. They tell their victims they owe back taxes that must be paid immediately. Typically they use aggressive tones and threaten arrest or civil action if the victim doesn't immediately wire funds or pay using a prepaid debit card. Unfortunately, this tactic has proven effective against the elderly and immigrants. If you receive a phone call or text message from someone claiming to be from the IRS, just hang up. The IRS always makes initial contact with a citizen through the U.S. mail and never threatens immediate arrest or civil action.
Similar to phone calls, email scams have seen explosive growth in recent years. The IRS claims phishing attempts soared 400% in the 2016 tax season. The emails may contain demands for back taxes while displaying official IRS logos. Again, the IRS will only make initial contact by mail. However, the phishing isn't limited to IRS impersonation. Intuit, the maker of Turbo Tax, has noticed a sharp spike in sophisticated phishing attempts used to trick users.
The scam works by convincing the user to log-in to a spoof website and then enter all of their personal information. The spoof websites are almost indistinguishable from the legitimate Turbo Tax website. To guard against this attack, avoiding logging into a website via links in your email. After receiving an email claiming to be from Turbo Tax, you should navigate to the Turbo Tax official website through trusted means, such as a Google search or manually typing in the website.
Some criminals are just as technologically inept as the rest of us. According to CNET, 8% of personal identification theft comes from criminals stealing W-2s out of mailboxes. By now, you should have already received your W-2 for 2016 wages because employers are required to mail W-2s by January 31. If you have not received yours, find out where it is. Either your employer has failed to comply or it could have been taken from your mailbox.
One of the easiest ways to secure your refund is to claim it before the criminal can. The IRS stated that it prevented $22.5 billion in fraud in 2014, but $3.8 billion in fraud still occurred. Scammers will take your personal information and file a tax return before you in order to claim your refund. The easiest way to prevent this is by filing before they do and claiming your refund first.