Tips For Taxpayers When Dealing With Tax Scam

The year 2018 approaches to end and millions of Americans are getting ready of their financial report and records in order to fulfill their respective tax obligations. Like a hunger wolf, fraud doers are just waiting for someone to devour. The Internal Revenue Services has been working to let taxpayers be aware and be guarded against every type of tax scam. The records revealed that one out of seven American adults say they have been a victim of identity theft, and 27% have been the victim of a security breach. It is a warning to each one to be vigilant and careful with every IRS transactions.

Tax fraud happens when your personal information such as name, Social Security number, address, etc. are stolen and used to commit tax-related identity-theft. Here are common tax scams and fraud to watch out for:

Phishing

Phishing starts with a phony email sent to you that appears to be from the IRS informing you that:

• There is a problem with the filed tax return and that you must provide for banking information for your tax refund be deposited electronically.
• Your bank account or credit card has been compromised but you can fix the problem by clicking the link to an IRS website;
• You have a tax obligation to pay and can do so by clicking to an attached web site.

The email will contain the IRS logo and looks like an official IRS email or appear to be from a legitimate bank, financial institution or a tax preparer.

If you fall to this scheme and made a mistake in providing bank account information, you will then discover that was not deposited to your bank account. Possibly, your bank account will be emptied by the person who posed as the IRS personnel.

Phone-related Tax Fraud

One day you will receive a phone call representing the IRS and demands for some cash deposits directly from your bank account. Some scammers alter their caller ID and provide you a fake IRS employment identification. Do not fall on this trap, keep in mind the following:

• IRS will never call to demand immediate payment, nor call you about taxes owed without first having mailed you a bill.
• They will never demand payment of taxes without giving you the opportunity to question or appeal the amount you owe.
• IRS will never require you to use a specific payment method for your taxes.
• IRS will never ask for credit or debit card numbers over the phone.
• Neither the IRS will threaten to bring in local police or other law-enforcement groups to have you arrested for not paying.

Upon receiving such phone call, you can dial the IRS number and ask if there are problems with your taxes. If there is none, certainly they will tell you. Report the phone call scam to the Treasury Inspector General for Tax Administration (TIGTA) at 1-800 366 4484 or at www.tigta.gov.
 

Identity Theft of Social Security

This happens when someone files bogus tax returns using someone else's Social Security number which was stolen via email, mail or telephone fraud. The victim will only discover this until she files a return or through IRS that someone submitted a tax return in his or her name. Criminals are aggressive in pursuing this scheme, but the IRS continue hunting them around.

Tax Return Preparer Fraud

Most of the tax professionals provide honest and high-quality service. There are some who wants to pose harm and hurt taxpayers by requesting personal information to update tax or financial records and later on taking improper deductions or credits to boost refunds. It is important for the taxpayer to be responsible for the completeness and accuracy of your own return.
 
Note the following guidelines to avoid fraud or scam:

• If you tend to file your taxes online, send your income tax return from your home computer and never use a public Wi-Fi access.
• Do not store sensitive materials on your home computer, you can use a portable USB hard drive and store the hard drive in a home or bank security vault for safekeeping.
• Prefer to use strong passwords and choose tax software preparation companies that use dual-factor authentication for further security. Don’t let scammers do their jobs easily.
• IRS does not initiate taxpayer communications through email.
• Do not click on any links or open any attachments claiming to be from the IRS, "Income Tax Department", or your tax preparation company
• Report any emails claiming to be from the IRS by forwarding the emails to phishing@irs.gov
• Never respond to unsolicited emails requesting scanned copies of personal documents.