Avoid These 3 Tax Scams
Tax season can be a stressful time for many, and unfortunately, scammers seize the opportunity to exploit unsuspecting individuals.
To safeguard your finances and personal information, it’s crucial to be aware of common tax scams and how to avoid them.
In this article, we’ll discuss three tax scams that you should watch out for and provide tips on protecting yourself from falling victim to these fraudulent schemes.
1. Phishing Scams
Phishing scams involve fraudsters posing as legitimate entities, such as the IRS or tax software providers, in an attempt to steal sensitive information.
They often send phishing emails that appear convincing, asking recipients to click on links or provide personal details.
How to Avoid Phishing Scams
– Be cautious of unsolicited emails and avoid clicking on links or downloading attachments from unknown senders.
– Verify the authenticity of communication by contacting the official organization directly through their official website or phone number.
2. Fake Tax Preparers
Some scammers masquerade as tax preparers, promising inflated refunds or charging exorbitant fees for their services.
They may file fraudulent returns without your knowledge, leading to legal consequences for you.
How to Avoid Fake Tax Preparers
– Choose a reputable tax professional with a Preparer Tax Identification Number (PTIN) and a good track record.
– Be wary of tax preparers who promise unusually high refunds or base their fees on a percentage of your refund.
3. Identity Theft
Identity theft during tax season involves criminals using stolen personal information to file fraudulent tax returns and claim refunds in your name.
Discovering that your identity has been stolen for tax fraud can be a lengthy and challenging process to resolve.
How to Prevent Identity Theft
– Safeguard your Social Security number, financial records, and personal information.
– File your tax return early to reduce the window of opportunity for identity thieves to file on your behalf.
FAQs
What should I do if I receive a suspicious email or call claiming to be from the IRS?
If you receive a suspicious communication claiming to be from the IRS, do not engage with it. Instead, report it to the IRS through their official website or contact the agency directly to verify the legitimacy of the communication.
Can the IRS call me about my taxes?
While the IRS may contact you by phone, they will not make threats, demand immediate payment, or request sensitive information over the phone. Always exercise caution and verify the caller’s identity.
How can I check the legitimacy of a tax preparer
To check the legitimacy of a tax preparer, verify that they have a Preparer Tax Identification Number (PTIN) and research their qualifications and reputation. You can also check for any disciplinary actions or complaints against them.
What should I do if I suspect I am a victim of identity theft for tax fraud?
If you suspect you are a victim of tax-related identity theft, contact the IRS Identity Protection Specialized Unit immediately. You should also report the identity theft to the Federal Trade Commission (FTC) and file a police report if necessary.
