Tax-related identity theft happens when someone uses your stolen personal information, such as your Social Security Number, to file a tax return claiming your refund. According to the IRS, reversing the damage caused by tax-related identity theft is a complex and frustrating undertaking for all involved. Scammers will use tax season as an opportunity to commit fraud, pretending to be the IRS, and asking consumers for cash, or asking consumers to convert cash to gift cards which is an easy way to transmit cash without the possibility of detection when the card is used. Identity protection is a 24/7/365 responsibility and a crucial one, particularly during the busy tax season. To give yourself a fighting chance and learn the best way to stay protected from the devastating effects of tax-related identity theft here are some helpful tips and tricks to help you.
According to the Federal Trade Commission (FTC) and Internal Revenue Service (IRS), some examples of scams this tax season are:
Scammers use computers to dial thousands of phone numbers, pretending they’re calling from the IRS, hoping to find victims who respond to their threatening statements. These criminals claim you owe taxes and demand that you pay immediately, usually with a gift card or prepaid debit card. The IRS does not initiate contact with taxpayers via phone.
These are the scammers who send out emails, pretending they are from the IRS. The imposters may use part of your real identity to convince you that their claim is valid. They will tell you that you owe taxes and demand that you pay up or face prosecution. Or they will ask you to verify that you have paid your taxes, asking for personal information and bank account numbers to obtain data that can be used later to commit identity theft. The IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels.
Criminals will gather or purchase your stolen personal information, create a bogus tax return and file the return with the IRS, claiming your refund. When you then file your legitimate return by mail, the IRS will send you a notice or letter saying that more than one return was filed for you. If you try to e-file, the IRS will reject your tax return as a duplicate filing. In either case, you are left with the difficult task of convincing the IRS that it wasn’t you that filed the return and received the refund the first time.