How to Prevent Tax Scams
Tax season is quickly approaching which mean scammers are on the move, waiting for their opportunity to get their hands on your information. Scammers know that filing taxes can be complicated and that stressed consumers may be more likely to fall for their tricks. Here at Robins Financial, account security is a top priority and we want to equip our members with the fundamental information on how to protect your accounts from tax scams. Follow this guide to keeping your information safe during tax season.
What are Tax Scams?
Tax scams are ploys created by scammers attempting to collect your personal and financial information. These scammers may contact you through the mail, email, or by phone, so it’s important to stay alert on all fronts. Almost all tax scam rely on impersonating an authority figure, such as the Internal Revenue Service (IRS), to make people pay up. Here are a few tax scams you should be on the lookout for:
- Tax-Related Identity Theft – Under this scam, identity thieves steal taxpayers’ personal information – such as your name and Social Security number – and use it to file fraudulent tax returns in order to receive funds. In most cases, you may not realize you’re a victim until the IRS rejects your tax return due to the previously filed fraudulent return.
- Phishing Scams – Phishing scams are when scammers send a message that appears to be from someone else, such as a reputable company (like the IRS) or financial institution, to trick you into sharing personal identifying information, including financial account information, debit and credit card details, login credentials, or other sensitive information. Though most phishing frequently occurs via email or text messages, there are also phishing scams that take place through social media messages or phone calls.
- Intimidation Scams – Let’s be honest, the thought of filing your taxes incorrectly or owing the IRS money can be scary. Because many people hold fear for the IRS, scammers take advantage of this fear in order to get them to do what they want. They may impersonate the IRS or even an employee from the Department of Revenue to intimidate people into payments on supposed back taxes. These scammers will often threaten people with arrest, lawsuits, and even imprisonment if the balance is not paid immediately.
- Dishonest Tax Return Preparer – While most tax preparers are trustworthy, there are some who set out to defraud the government in your name. They may ask you to sign a blank return, for example, leaving them free to claim almost anything without your knowledge. A trustworthy tax preparer will always ask for receipts and other typical documentation, and will usually have a fixed fee for filing. If they don’t need this information or ask for a percentage of your tax return, it’s time to look for a new preparer.
How to Protect Yourself
Filing your taxes can be stressful enough without the added fear of running into a tax scam. We’re here to help you identify potential tax scams this season so you can keep your information safe and secure.
- File early. The sooner you can file your taxes, the better. The IRS identifies many cases of identity theft where fraudsters use stolen personal information to file a tax return early in the season so they can claim a refund. Consider it preventative care. The earlier you file, the less of a chance fraudsters have to file pretending to be you.
- Look, but don’t click.Never click on any links or open any attachments that are sent to you from an unknown source or someone posing to be the IRS. The IRS generally only uses mail to contact you regarding your taxes.
- Report suspicious activity. If you or someone you know receives suspicious emails, messages, or phone calls from someone claiming to be the IRS, report it immediately. You could save yourself and many others from falling victim to tax scams.
When tax season rolls around, it can be easy to let the stress of finances cloud your judgement and compromise your safety. That’s why we want our members to be aware of common tax scams to give you a sense of peace. You’ll know what to expect and can feel confident about spotting anything suspicious. Protect yourself from scams this tax season and visit our website for more information about how we protect our members.
At Robins Financial Credit Union, our mission is to enhance the financial well-being of our members and community. We honor this commitment by providing educational content to help you make the most of your finances. Read our other blog articles to help you gain the financial knowledge you need to succeed.