Each year, the IRS publishes the “Dirty Dozen,” a list of 12 scams that are rampant during that year’s tax season.
This year, the IRS is cautioning taxpayers to be extra vigilant because of a 60% increase in email phishing scams over the past year. This is particularly disheartening, since it comes on the heels of a steady decline in phishing scams over the previous three years.
Typically, an email phishing scam will appear to be from the IRS. Once the victim has opened the email, the scammer will use one of several methods to get at the victim’s personal information, including their financial data, tax details, usernames and passwords. They will then use this information to steal the victim’s identity, empty their accounts or file taxes in the victim’s name and then make off with their refund.
Scammers have several means for fooling victims into handing over their sensitive information. The most popular tax-related phishing scams include the following:
1. Tax transcript scams.
Victims are conned into opening emails appearing to be from the IRS with important information about their taxes. These emails actually contain malware.
2. Threatening emails.
These phony emails appear to be from the IRS, demanding immediate payment for unpaid back taxes. If the victim clicks on the embedded link, their device will be infected with malware.
3. Refund rebound.
A crook posing as an IRS agent will email a taxpayer, claiming they’ve been awarded too large a refund. The scammer will demand the immediate return of the “extra” money via prepaid debit card or wire transfer.
4. Phony phone call.
A caller spoofs the IRS’s toll-free number and calls a victim, claiming they owe thousands of dollars in taxes that must be paid immediately under threat of arrest or deportation.
If you’re targeted
When targeted by any scam, it’s crucial to not engage with the scammer. If your Caller ID announces that the IRS is on the phone, don’t pick up! Even answering the call to tell the scammer to get lost can be enough to mark you as an easy target for future scams. If you accidentally picked up the phone, hang up as quickly as possible.
Similarly, suspicious-looking emails about tax information should not be opened. Mark any bogus tax-related emails that land in your inbox as spam to keep the scammers from trying again.
Report the incident to help the authorities crack down on these crooks. Forward suspicious tax-related emails to firstname.lastname@example.org. You can also alert the Federal Trade Commission at FTC.gov.
Protect yourself against tax scams with these steps:
- File early in the season.
- Use the strongest security settings for your computer.
- Use unique, strong passwords for your accounts.
- Whenever possible, choose two-step authentication.
Remember, the IRS will never:
- Call about taxes owed without having first sent you a bill via snail mail.
- Call to demand immediate payment.
- Threaten to have you arrested for unpaid taxes.
- Require you to use a specific payment method.