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Wednesday, March 25, 2015

TAX TIME SCAMS- IRS Scam and Refund Scam

With April 15th quickly coming here are some reminders about scams that we see at this time of year:

IRS Scam- Regular readers already know about this scam. Simply put, the IRS will not call you demanding you pay for back taxes or penalties with a pre-paid card. Nor will it arrest you if you don’t pay right away. If you have not heard of this scam, here is an alert from the IRS http://www.irs.gov/uac/Newsroom/Scam-Phone-Calls-Continue;-IRS-Identifies-Five-Easy-Ways-to-Spot-Suspicious-Calls.

Inflated Refund Scam- Another scam to be wary of is a supposed tax preparer promising inflated refunds from the IRS. According to AARP’s Fraud Watch Network:

“With 60% of taxpayers using professional help in filing their taxes, people should be suspicious of anyone promising inflated refunds. "Every filing season, scam artists lure victims in by promising outlandish refunds,” said IRS Commissioner John Koskinen.

How it works:

•    The scammer tells his targets they will get a large refund saying they qualify for fictitious tax credits, rebates, or government benefits.

•    They may also file a return in the person’s name and not tell the person that a refund was made – the money goes straight into the scammers’ bank account.

•    These fraudsters may use flyers distributed door-to-door or in community gathering places, advertisements, phony store fronts and word of mouth through community groups and churches to lure their victims.

What to do:

•    Watch out for tax preparers who promise a big refund - maybe even before looking at your records.

•    Be careful of supposed tax preparers who charge fees based on a percentage of the return – this is not a standard practice and gives the preparer a strong incentive to falsify the return.

•    Make sure you get a copy of the return that was filed – and then track the return (at  http://www.irs.gov/Refunds) on the IRS website. 

•    And of course, never sign a blank return – no matter what promises are made!”
 

Identity Theft Refund Fraud- The Fraud Watch Network also warns about identity theft refund fraud:

“Taxpayers also need to watch out for identity theft, particularly around tax time.

How it works:

•    You file your taxes expecting a refund.

•    But, you find out that someone else, using your Social Security number and likely other personal identifying information, has filed a return in your name.

•    Your return is rejected as a "duplicate" because a refund has already been issued to the scammer.

Also know that scammers will often steal Social Security numbers and other personal information of people who may not be filing a tax return—like your children or grandchildren, folks who may not have income to report, or even the recently deceased. So please share this alert with family and friends and help them detect and correct fraud!

What to do:

If you think someone used your Social Security number for a tax refund contact the IRS as soon as possible. Specialists will work with you to get your tax return filed, get you any refund you are due, and protect your IRS account from thieves in the future. Go to www.irs.gov/identitytheft or call 800-908-4490. Also if you haven’t received your refund yet, visit irs.gov/refunds to check your status.”

For more information, go to:

IRS:



 

 

 

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