South Snohomish County Crime Watch Hot Sheet: TAX SCAMS- A Yearly Danger

Thursday, February 13, 2025

TAX SCAMS- A Yearly Danger

One of the bread-and-butter scams that fraudsters use involves the IRS and the requirement to file our income tax returns by April 15 of every year. Fraudsters have developed several tactics to steal your money while impersonating IRS personnel or to impersonate you to claim refunds in your name.

Most of their scams involve tricking you into sending money or your personal information to the scammer who is impersonating the IRS. But one scam involves the scammer impersonating you:

· Tax Identity Theft. Scammers will obtain your personal information such as Social Security Number, birth date, etc. They might purchase it on the dark web. Or they might obtain it from corrupt tax preparers, from phishing campaigns, hacks of tax firms or employers’ personnel records, or mail theft. They will use your information to file a tax return with the IRS early in the year to so that the IRS receives it before you file your income tax return. The fraudster will claim deductions so that they receive a refund. You will not know that they have claimed this money in your name until you receive a notice that the IRS has already received “your return.”

Other methods have the scammers, impersonating the IRS, contacting you to send them money:

· Fake IRS phone calls or emails. Scammers will claim that you owe back taxes or fees then demand immediate payment with gift cards, wire transfers, or cryptocurrency.

· Phishing scams. Scammers send emails or texts impersonating the IRS and try to trick you into sending them your personal information.

· Pandemic Relief Scams. Scammers will claim that you have been overpaid for Employee Retention Credits or stimulus payments that you received and demand that you repay some or all.

· Online Tax Filing Scams. Scammers will create a fake tax filing website that will look like well known, trusted services then steal the information that you upload.

What can you do to prevent being victimized by a tax scammer? The National Security Alliance makes the following recommendations,

· File your taxes as early as you can.

· Secure your return with an IRS IP PIN. An Identity Protection PIN (IP PIN) is a six-digit code that prevents unauthorized tax filings using your Social Security number. You can apply for an IP PIN through the IRS.

· Enable multifactor authentication (MFA). Use MFA on all tax related accounts including your IRS account.

· Be alert to tax scams and phishing. Some red flags include:

o Unsolicited IRS communications. The IRS never initiates contact via email, text, or social media. If the IRS wants to contact you, it will send you a letter via snail mail.

o Urgency and threats. Scammers often use scare tactics to get you emotional, such as threats of arrest or financial penalties to get you to act quickly and without thinking.

o Requests for sensitive information. If an email or phone call asks for your social Security number, banking details, or login credentials don’t respond. Delete the email or hang up.

o Watch for phishing emails or texts. Inspect any emails/texts to ensure they are not a phishing email/text. Links and attachments within the message can collect your sensitive information or download malware onto your device.

· Ask your tax preparer about their cybersecurity practices.

· Use secure methods to send tax documents such as encrypted email or a secure file-sharing portal that your tax provider provides.

· Back up your tax records.

Scam Busters:

https://scambusters.org/taxscam2025.html

United States Postal Inspection Service:

https://www.uspis.gov/news/scam-article/fraudulent-tax-returns-and-refunds

AARP:

https://www.aarp.org/money/scams-fraud/tax-id/?intcmp=AE-FWN-LIB4-POS7

https://www.aarp.org/money/scams-fraud/tax-preparation/?intcmp=AE-FWN-LIB4-POS8

Federal Trade Commission:

https://consumer.ftc.gov/consumer-alerts/2024/01/irs-doesnt-send-tax-refunds-email-or-text