Curt Fowler: Tax Scams to Watch Out for in 2021
Monday, March 1st, 2021
Tax season always brings out a new batch of scams designed to separate you from your hard-earned cash. Here are the top scams that you should be looking out for this year.
Tax Refund Fraud: This happens when scammers file a fraudulent return using your Social Security number. The scammers file early and inflate your refund. They get your refund before you have a chance to file.
There are two ways to avoid this fraud:
– Protect your Social Security number. Never respond to unsolicited emails by providing personal information.
– File for an Identity Protection Pin from the IRS before you file your taxes. The IP Pin is a six-digit code that must be used to file your tax return in addition to your Social Security number. Once you’ve opted in, you cannot opt-out and you will receive a new PIN each year through the mail. Visit this site to learn more about the program: https://www.irs.gov/identity-theft-fraud-scams/get-an-identity-protection-pin
Ghost Tax Preparers: Tax preparers are required to sign your return and include their Preparer Tax Identification Number on the return. If your preparer does not sign your return and provide their PTIN, take your information and walk away. They are likely trying to make a fast buck at your expense.
IRS Phone Scam: The scammers call you saying they are the IRS and you have a tax bill that must be paid immediately or you will be arrested. The scammers can even make their caller ID show as “IRS” on your phone.
The IRS will never:
– Call to demand immediate payment using a specific payment method such as a pre-paid debit card, gift card or wire transfer. The IRS almost always sends mail correspondence before contacting a taxpayer.
– Threaten to bring in local police or other law-enforcement to have the taxpayer arrested for not paying.
– Demand that taxes be paid without allowing the taxpayer to question or appeal the amount owed.
– Ask for credit card or debit card numbers over the phone.
– Call about an unexpected refund.
If you get one of these calls and you are concerned that you owe the IRS, contact your tax preparer (assuming they aren’t ghosting you) or call the IRS directly by going to IRS.gov/help/telephone-assistance to get their number.