Today Timothy P. Camus of the Treasury Inspector General for Tax Administration (TIGTA) testified to the Senate Committee on Finance about the tax scams and schemes they are seeing so far this year.
Phone Impersonation Scam
Scam artists call impersonating an IRS agent. They often sound official by giving you their badge number, spoofing their caller ID, or knowing part or all of your Social Security Number. They then demand immediate payment and threaten the victim with arrest, loss of drivers license, lawsuits and various other punishments. From the report:
The IRS will never:
- Call to demand immediate payment, nor will the IRS call about taxes owed without first having mailed you a notice;
- Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe;
- Require you to use a specific payment method for your taxes, such as a prepaid debit card;
- Ask for credit or debit card numbers over the phone; and
- Threaten to bring in local police or other law enforcement groups to have you arrested for not paying.
If you truly feel the IRS may have tried to contact you, go to IRS.gov to locate their phone number and then call IRS to ask if they are trying to contact you. Currently the contact us link is at the bottom of the home page and the number is 1-800-829-3676.
The crooks call or email telling the victim they have won a lottery but before they can receive the prize they must send in the money for the taxes. Lotteries do not work this way. If required, the lottery will withhold income taxes from your winnings. They never ask for you to pay the taxes out-of-pocket. A legitimate lottery will not offer to loan you the money and deposit the loan in your bank account. They just want your bank account number.
Essentially, someone uses your personal information or that of a dependent to file a return and get a refund. At the very least, this makes filing your own return a real hassle. Other than protecting your personal information there is not much you can do about this.
Really, the IRS cannot get a list of prisons and cross check the list before sending a refund? They have tried flagging prisoners’ Social Security Number but cross checking addresses seems an easy additional step. Some prisoners actually have to file returns. For example, they may have earned income being put in jail or they may have a lot of investment income.
Unscrupulous Tax Preparers
Some tax preparers steal your identity or just your refunds. Often the returns they file on your behalf are grossly inaccurate. There is no sure way to determine who they are. Some things to watch out for would be them not signing your return, promising things that do not sound likely, and not being open with you.
The IRS does not start contact with a taxpayer via email. Also be careful of fake websites purporting to be the IRS or some other tax agency. The IRS site is IRS.gov. If you truly feel the IRS may have tried to contact you via email, go to IRS.gov to locate their phone number and then call IRS to ask if they are trying to contact you. Currently the contact us link is at the bottom of the home page and the number is 1-800-829-3676.
You can read the entire report here (downloads as a PDF).