Top 10 Most Common IRS Scams
The IRS constantly warns taxpayers to be on the lookout for the “Dirty Dozen” scams, which are always more common to peak during tax season and result in identity theft and financial drain. Numerous taxpayers become the objects of the scammers with their clever tactics such as phishing emails and the scammers posing as IRS agents for their vicious aims. Awareness and vigilance are crucial to protect taxpayers from these deceptive tactics.
In this article, We’ll explore the top 10 most common IRS Scams.
Top 10 Most Common IRS Scams
Let’s look at the 10 Most common IRS scams that are being targeted the most among common people.
1. Phishing Emails or Texts
Phishing scams are committed by fraudsters posing as legitimate institutions to scam people into giving them their private data. The IRS has the most phishing scams observed, initiated via email or text message. Typically, these messages include links or attachments that, if you click on them, may install malware on your device or lead you to a counterfeit website created to pilfer your personal and financial information.
How To Avoid?
- Be Skeptical: Don’t pay attention to unsolicited messages that claim to be from the IRS inside.
- Verify: Communicate only through the IRS official channels to avoid dealing with potential scams.
- Protect Personal Information: Never share passwords or security details using emails or text.
2. IRS Impersonators Calling
Another frequently used scam, which is fake senders pretending to be IRS agents and calling people, is one of them. Those fraudsters can squeeze a victim by using fear tactics, which in turn can be in the form of the threat to arrest or illegal prosecution to instantly ask for some money or any further information over the phone.
How To Avoid?
- Know the Signs: The IRS will not request an immediate money order or wire transfer through the phone or Internet.
- Hang Up: In case you suspect a scam call, disconnect the conversation immediately.
- Report: Notify the Treasury Executive of Government for Administration (TIGTA) about the phone call.
3. Tax Refund Recalculation Scam
During the tax season, people usually impatiently wait for their tax refunds to arrive or even check their availability instantly. The excitement that arises from this situation can be capitalized by fraudsters who spam the emails or impersonate phone calls claiming that the tax return is recalculated and further refund money is earned. They’ll then request your personal information or payment to process the supposed refund.
How To Avoid?
- Verify Refund Status: Use the “Where’s My Refund?” tool on the IRS website.
- Ignore Promises: Be wary of unsolicited promises of larger refunds.
- Secure Your Information: Keep your financial information private.
4. Gift Card Scams
The number of gift card scams has grown at a fast pace in recent years with crooked fraudsters taking advantage of the privacy and ease of the payment option to put in dire distress unsuspecting victims. In such illegitimate activities, persons are called or sent emails by someone impersonating the IRS or any other agency to demand payment of taxes or fines through gift cards.
How To Avoid?
- Recognize the Scam: The IRS will never ask for payments via gift cards.
- Educate Others: Inform friends and family about this scam.
- Take Action: Report the incident to the Federal Trade Commission (FTC).
5. Falsifying Income to Claim Credits
Some people may feel they should think of writing phony details or lying to the Tax Authority about their finances just to evade their legal share of taxes. This erroneous idea leads to fines, penalties, and even criminal proceedings.
How To Avoid?
- Report Accurately: Always provide truthful income information.
- Seek Professional Help: Consult a reputable tax preparer.
- Review Your Return: Ensure all information is correct before filing.
6. Impersonation of Charitable Organizations
Although helping charitable organizations is a good cause, some people may deceive your emotions and force you to believe that they are legitimate charitable organizations during tax season. They will call, send emails, or even speak personally to individuals asking for a charity donation, promising money for charity and a tax reduction later on. But the thing that might happen is that the scammers are just making use of this charity for their personal use.
How To Avoid?
- Research: Verify charity legitimacy through the IRS’s Tax Exempt Organization Search.
- Donate Wisely: Give to known and trusted organizations.
- Keep Records: Document your donations for tax purposes.
7. “Ghost” Tax Preparers
Ghost tax preparers are preparers who are operating illegally and do not have any relevant documented qualifications. These non-professionals only want to mislead their possible customers to do business with them promising high amounts of refunds or very cheap rates but when it comes to reality, they do not fulfill their duties properly and perform fraudulent actions where the IRS may be getting involved.
How To Avoid?
- Check Credentials: Ensure the preparer has an IRS Preparer Tax Identification Number (PTIN).
- Review the Return: Never sign a blank or incomplete return.
- Understand Fees: Avoid preparers who base their fee on your refund amount.
8. Social Security Scams
Social Security fraud is a growing epidemic that specifically targets individuals, just the old, by threatening to cut their Social Security benefits falsely due to any potential problem they can find in their accounts. They will contact the victims using phone, email, or text and usually act like representatives of the Social Security Administration (SSA) and will ask for money right away or personal information to address the alleged issue.
How To Avoid?
- Stay Calm: Do not react to threats or demands.
- Verify Identity: Contact the Social Security Administration (SSA) directly.
- Protect Your SSN: Never share your SSN over the phone unless you initiate the contact.
9. TurboTax Scams
TurboTax is used by millions of people and it is one of the leading tax preparation software, which is highly useful for tax filing procedures. However, Internet scams can be performed in the name of TurboTax and by creating false sites or fake emails folks can try to grab all the confidence given to this tax software by individuals.
How To Avoid?
- Use Official Channels: Contact TurboTax through their verified support channels.
- Guard Access: Never allow remote access to your computer to unverified individuals.
- Monitor Accounts: Regularly check your accounts for unauthorized activity.
10. Inflated refund scams
Inflated refund scams prey on individuals’ desire to maximize their tax refunds. Unfortunately, scammers lure potential victims with unrealistic reimbursement promises, relying on hyperbolized expense and credit statements to confuse any taxpayer into submitting an incorrect refund.
How To Avoid?
- File Accurately: Always file a tax return reflecting your income and deductions truthfully.
- Choose Reputable Preparers: Work with tax professionals holding valid PTINs and a track record of trustworthiness.
- Review Your Return: Before submission, carefully inspect your tax return for discrepancies or inflated figures.
Conclusion
In Conclusion, being alert and informed is the key when it comes to protection from IRS scams. You should become familiar with how some tricks are carried out so that you can avoid fraud. By just being careful of these facts, your personal and financial information will be kept safe from criminals. IRS does not require sensitive information via email, text, or phone, nor will they demand payment quickly by those methods. Notify the authorities if you identify suspicious behavior in a very timely manner.
Also Read
Top 10 Most Common IRS Scams – FAQs
What is the IRS concerned with?
The Internal Revenue Service is a bureau under the U.S. Treasury Department, whose primary duty is to perform the Income Revenue Code (IRC), regulate the federal tax system, and taking tax from the American citizen and corporate taxpayers. The IRS produces several types of taxes including gift, excise, estate, and income ones. IRS also always carries out audits to control. Audits are also carried out by the IRS always to ensure that taxpayers are conducting their affairs in accordance with the tax laws
What is the best contact for the IRS?
- If you need help on individual tax filings, you can reach out the IRS on the toll-free 1-800-829-1040 hotline, Monday through Friday, any time between 7 and 7 PM local time.
- For those living outside the US will have to dial the 267-941-1000 from Monday through Friday, 6 AM – 8 PM Eastern time
How do I know if the IRS email is real?
The IRS does not contact individuals using email. If an IRS employee needs to have the document sent by email during ongoing interactions, they’ll call you for identity verification and email consent. They will ask you to send a confirmation email that will be sent to their IRS email address.
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