Tax season 2016: Don’t fall victim to scammers
Tax refund fraud has been a growth industry in recent years. This time each year identity thieves make a living filing fraudulent returns and cashing in on the unwitting victims’ tax refunds.
With tax forms in the mail and online, fraudsters will seize the opportunity for phone scams, mail theft, phishing, and identity theft. Their focus is on stealing your personal information and ultimately your tax refund money.
The IRS estimates it paid $5.8 billion in fraudulent identity theft refunds in 2013, and thwarted fraudulent refunds worth more than $24 billion.
Don’t be one of the thousands of people affected every year. Follow a few simple tips to help protect yourself, your business, and your employees from the scammers.
Pay attention to your mailbox – and file early
Be alert when tax forms are in the mail. Don’t let your mail pile up in your mailbox. You’re giving thieves easy pickings if your tax forms with your personal information are accessible. Consider using a locking mailbox, a P.O. box, or opting for electronic delivery of your tax documents. A key tip from the IRS is also to file early, so that the real return is processed first.
Business owners can help protect their employees and others by distributing printed tax forms with paychecks or at work locations. Alternatively they can deliver W-2 and 1099 forms electronically.
Of course, our computers and email are not bulletproof, but you can help protect your personal computers by using firewalls, anti-spam, and anti-virus software. Make sure to routinely install updated software and security patches and use complex passwords that you change from time to time for Internet accounts.
Beware of the impostors
At tax time, criminals frequently pose as the IRS to trick victims out of money or personal information. They call you and leave voicemail messages that sound very convincing.
Never give personal information over the phone, or through the mail or the Internet, unless you have either initiated the contact or are sure you know who is asking. Scammers often use threats and intimidation to convince you to give them information or to send them cash.
The IRS does not initiate contact with taxpayers via email to request personal or financial information. Also the IRS does not use text messages or social media channels to request personal information.
If you receive a scam email, forward it to email@example.com. If you receive a suspicious call purporting to be from the IRS, report it to the Treasury Inspector General at 800-366-4484.
Go to the IRS site for more detailed information about how to identify and avoid scam calls.
In addition, always take care with your Social Security number, don’t give it out without asking how it’s going to be used and stored.
Five warning signs of identity theft
If you see any signs that your identity may have been stolen, don’t panic. There is plenty of advice available to help you take action. Here are five scenarios that might alert you that someone is using your information:
1. Withdrawals from your bank account or charges on your payment cards that you don’t recognize.
2. Expected mail fails to arrive.
3. Unfamiliar accounts on your credit report.
4. Bills from medical providers for services you didn’t use.
5. Notification from the IRS that more than one tax return was filed in your name, or that you have income from an employer you don’t work for.
Take a look at more scenarios here.
If you know your personal information has been stolen, you need to act quickly.
Developing a plan can help you recover from the event. The Federal Trade Commission’s site is very clear and outlines the steps you can take with useful links.
The IRS is fighting back against the tax criminals. But you can help them and yourself stay secure. With proper vigilance, you can help avoid an experience of “fraud season.”