How to avoid being a victim of Tax Scams

The tax season can be an expensive and confusing time of year with all types of schemer ready to steal refunds. The tax scam is as long as the tax itself.

But nobody wants to face monetary losses, credit score or damages that can accompany tax frauds. It's essential to have at least a fundamental understanding of what the most common types of tax fraud are and how to frustrate them. You can find this information below.

Scam And Tax Fraud

• Fraudulent declarations (identity theft): with just social security number or address, fraudsters can file a fraudulent tax return and, eventually, maintain the victim's reimbursement, if applicable. It's a serious problem that made the IRS pay around $ 1,600 million between 2015 and 2017.

So don't skip past the warning signs, a letter from the IRS on multiple returns or a failed electronic file attempt in particular. It is worth repeating the letter if you try to register online and you cannot do it, it is possible that the scammer has already sent a return request with your name.

The idea of someone making taxes can seem quite interesting in normal circumstances. It's something you usually have to pay. It is not the issue when it comes to fraudulent tax returns; it cannot cause any inconvenience on the part of the IRS.

That being said, the best ways to prevent scammers from filing a return on your behalf are:

• File as early as possible each year, even if no fees are expected or a refund is received.
• Take measures to safeguard your personal information
• Phishing: scammers often claim to be IRS agents, accountants or other types of financial professionals. They need to know clients financial information, which they can sell or exploit to make a profit. And they often use this kind of pattern with recent immigrants appearing in the United States for the first time, and commonly threatens deportation as a penalty for non-compliance.

Phishing is perhaps the simplest type of tax fraud to be avoided. All you have to do is avoid e-mails and phone calls from people who claim to be reliable financial agents.

• After all, the IRS explicitly said that it does not initiate contact with taxpayers via e-mail, text messaging or social media channels to solicit personal or financial information. Furthermore, they do not threaten taxpayers with lawsuits, imprisonment or other enforcement measures, such as deportation.
• Illegal assistance/service companies: many companies require the possibility of finding hidden deductions, negotiating with the IRS on behalf of the user or performing other services that appear vaguely legitimate. Unfortunately, many of them are merely an opportunity to charge high fees for empty promises. And they will work on a creative contract language to limit the need for tangible results, protect you from liability and prevent you from doing anything about it.

Before signing anything, make sure you do your homework: look for the reputation of the company, read the reviews carefully and read carefully everything that requires a signature, in particular, a seemingly binding contract.

Advice For Taxpayers

The tax fraud prevention manual differs very little from what you should do to avoid other types of dirty financial games. After all, a tax scammer needs the same information as someone asking for a loan on his behalf. Therefore, if there are indications that your data are exposed, you will know that your refund could be at risk.

• Understand the process: the more you understand how the submission and reimbursement process must operate and what the rights and obligations of a taxpayer are, the more difficult it is to be scammed, So study. 
• Request a tax transcript: If the IRS grants you a free copy of your record when you request it, you can compare your income with the declared income to ensure there are no inconsistencies, which could indicate fraud. 
• Use the Too true to be good test: In a sense, we are all inclined to be optimistic and believe in the sales pitches we see on TV and listen to the radio, especially if they offer simple solutions to complicated problems.
• Keep personal information private: today there is digital and physical information on everyone. There are also curious eyes when it comes to both. That's why it's so essential to take the following necessary precautions to prevent your information from falling into the wrong hands:
• Simply enter your payment information in https URLs.
• Never send account numbers and passwords by email.
• Use passwords that combine with numbers, letters and special characters and change them regularly.
• Destroy financial documents before discarding them to protect yourself from fraudulent fraud (which is more common than you think).
• Sign up for credit supervision: no one has the time to view your credit reports 24 hours a day or face the consequences of not doing it. That's why it's so useful to sign up for a free credit check 24 hours a day, 7 days a week. It acts as a quick warning system for identity theft, fraud, and costly credit reporting errors. This way, you will know when suspicious changes occur and can resolve any related problems as quickly as possible.
• Check monthly bills: sometimes credit card companies and other credit institutions make mistakes. Balances, transactions or unusual payment history can also indicate unauthorized use of your account. Monthly bills are also a good source of information when analyzing problems in the credit report.
• Report for lost or stolen cards: immediately report a social security card, a credit card, a debit card, etc. helps to limit the unauthorized use of your financial accounts and fraudulent transactions.