Drake Software blog for tax pros, covering tax, IRS news, and more

Scammers Turning up the Heat on Taxpayers

Scammers Turning up the Heat on Taxpayers

Apparently the Internal Revenue Service and tax professionals aren’t the only ones getting ready for income tax season. Scammers and identity thieves are getting busy as well, hitting taxpayers – and tax pros – with a variety of scams and schemes aimed at identity theft and refund fraud.

Lately, it’s become an annual occurrence this time of year; the IRS generally sees an increase in scams targeting taxpayers, whether they’re sent by email, the web or over the phone.

As part of the IRS partnership with the income tax industry called the Security Summit, Drake works with the Summit partners to advise the IRS and collaborate to make the American tax system more secure.

To make your tax season more secure, here are a few of the most notable tax scams out there.

Requesting fake tax payments: The IRS has seen automated calls where scammers leave urgent callback requests telling taxpayers to call back to settle their “tax bill.” These fake calls generally claim to be the last warning before legal action is taken. Taxpayers may also get live calls from IRS impersonators. They may demand payments on prepaid debit cards, iTunes and other gift cards or wire transfer. The IRS reminds taxpayers that any demand to settle a tax bill using any of these payment methods is a clear indication of a scam. (IR-2016-99)

Targeting students and parents and demanding payment for a fake “Federal Student Tax”: Telephone scammers are targeting students and parents demanding payments for bogus taxes, such as the “Federal Student Tax.” If the person does not comply, the scammer becomes aggressive and threatens to report the student to the police to be arrested. (IR-2016-107)

Sending a fraudulent IRS bill for tax year 2015 related to the Affordable Care Act: The IRS has received numerous reports around the country of scammers sending a fraudulent version of CP2000 notices for tax year 2015. Generally, the scam involves an email or letter that includes the fake CP2000. The fraudulent notice includes a payment request that taxpayers mail a check made out to “I.R.S.” to the “Austin Processing Center” at a Post Office Box address. (IR-2016-123)

Pretending to be from the tax preparation industry: These emails are designed to trick taxpayers into thinking these are official communications from the IRS or others in the tax industry, including tax software companies. The phishing schemes can ask taxpayers about a wide range of topics. E-mails or text messages can seek information related to refunds, filing status, confirming personal information, ordering transcripts and verifying PIN information. (IR-2016-28)

But it’s not just taxpayers who are being targeted. Scammers have also turned their attention to human resources departments and payroll professionals. They should be aware of phishing email schemes that pretend to be from company executives and request personal information on employees. The email contains the actual name of the company chief executive officer. In this scam, the “CEO” sends an email to a company payroll office employee and requests a list of employees and financial and personal information including Social Security numbers (SSN). (IR-2016-34)

And the tax professionals themselves aren’t being left out, either. Tax professionals could get emails that pretend to be from tax software companies. The email scheme requests the recipient download and install an important software update via a link included in the e-mail. If they follow through, recipients think they have downloaded a software update when in fact they have loaded a program designed to track the tax pro’s key strokes - a common tactic used by cyber thieves to steal login information, passwords and other sensitive data. (IR-2016-103)

The best way to tell if a suspicious phone call, email or website is fake is to know what the IRS will not do. The real IRS will never call a taxpayer to demand an immediate payment using a specific payment method – such as a prepaid debit card or gift card. The real IRS will never threaten to turn a taxpayer over to the local police and have them arrested. The real IRS will never demand a taxpayer pay a tax bill without giving them the opportunity to question or appeal the amount. And the real IRS will never ask for credit or debit card numbers over the phone.

If you get an email or phone call that seems suspicious, defense is easy. If a phone call is bogus, hang up. If an email doesn’t ring true, delete it. If you visit a website that you’re not convinced is real, close your browser. Remember: Never click on any link presented in a suspicious email or website. And never give any information over the phone.

If you get an unsolicited email that claims to be from either the IRS or an organization linked to the IRS - the Electronic Federal Tax Payment System (EFTPS), for example – report it by forwarding the suspect message to phishing@irs.gov.

 

Bob Williams

Forget genes; I’ve got words in my DNA. Communication has been part of who I am nearly all my life. From a long career in radio news to another one in newspapers – and a University of Georgia journalism degree sandwiched between the two – language has been my life. I’ve also been fortunate to have learned the tax business from the ground up here at Drake, starting with 1040.com online forms some years ago before moving on to work on the Web. In all things tax-ish, we aim to give you tools you can use.