Tips to Avoid Tax Fraud

Author: Kolin Hodgson

Tax season is upon us. It can be quite a chore to gather the appropriate information to file a 2019 tax return by the April 15 deadline. But you might want to file early and be on guard for tax time fraud scams.

To protect yourself against tax fraud, you may want to consider filing your taxes sooner than later. If you do, you beat scammers who are submitting phony returns and you buy yourself time to resolve any potential issues with the IRS.

In 2019, the IRS blocked $2.7-billion in fraudulent refunds. Taxpayers legitimately filed their taxes last year only to find that they had already been filed by a scammer. Tax fraud criminals are active right now and their scams come in all forms.

You may receive a call from someone pretending he/she is from the IRS, and demand you pay your taxes immediately to avoid being arrested. Or you could receive a phishing email stating your taxes are overdue. It will direct you either go to a website or open an attachment to process your overdue taxes. Here are some other tactics scammers will use during this time of year:

  • An email or phone call that creates a strong sense of urgency or threatens you if you don’t act
  • An email with an attachment claiming to help you with “tax law changes.” In most cases, the attachment will contain a virus that will infect your computer
  • Email messages that ask you to “verify information” about your taxes or other money matters
  • An email or phone call with enticing offers, such as how to receive your tax return refund early
  • Email messages with incorrect spelling, phrasing or language especially if they demand personal and financial information like your social security or credit card number or bank account

Remember, the IRS will never call, email or text you, or advertise on social media. The only way the IRS will contact you is through regular mail.

Protect yourself from fraud with good Internet habits:

  • Don’t click a link in email if the website has anything to do with money, like your taxes, bank account, insurance or investments. Always open a new browser window and type in the internet website name yourself to verify if it is legitimate.
  • Install anti-virus software and keep your applications updated
  • Avoid sending financial information through email
  • Don’t discuss tax or other financial information over the phone unless it’s with a trusted party, and you placed the call

To learn more about tax fraud and additional ways to protect yourself, refer to these articles: File Your Taxes Before Scammers Do It For You and the IRS’s website Taxpayer Guide to Identity Theft.