Your Ultimate Guide to Outsmarting Tax Scammers and How To Protect Yourself from Identity Theft

There are a lot of hassles associated with tax season, from document collection to scheduling the time to submit. However, you should try to prevent being a victim of a tax fraud.

Scammers search for methods to deceive individuals into parting with money or personal information throughout the year. As tax season approaches, there are a number of typical scams, so people should be alert for warning signs, according to Amy Nofziger, director of victim assistance at the AARP Fraud Watch Network.

Identity theft schemes are among the most prevalent kinds. When taxpayers attempt to submit their tax returns and the IRS indicates they have already done so, they typically become aware that their identity has been stolen. This typically indicates that someone else submitted a refund application in their place.

The IRS received 294,138 complaints about identity theft in 2023. According to the IRS, it takes an average of 19 months for taxpayers who have been the victims of identity theft linked to taxes to have their returns processed and refunds sent.

Common Scammers Tactics

Fear

Scammers use wording that suggests an issue needs to be resolved when they contact you by phone or email. For instance, a fraudster can email you to inform you that there is a mistake on your tax return and that you will face consequences if you don't correct it.

Urgency

People rush because con artists are skilled at instilling a feeling of urgency, leaving them open to attack. Scammers frequently persuade people to act immediately, which may lead them to divulge personal information like Social Security numbers.

Money

According to Efstathopoulos, con artists utilize money as a lure. If you pay them for their services or provide your personal information, they may pose as tax experts or the IRS and promise you a larger refund than you anticipated.

Verify If It's Really the IRS Contacting You

According to Dr. Zulfikar Ramzan, chief scientist of the digital security firm Aura, it's critical to understand that the IRS never contacts individuals through non-traditional channels. Typically, the IRS uses the United States postal service to contact taxpayers. The Postal Service.

A typical impersonation scam involves someone calling you, pretending to be from the IRS, and requesting an instant payment.

Research Tax Experts

Make sure the tax professional you hire is legitimate by doing homework on them, advised Nofziger.

Nofziger advises looking for credible listings to avoid being duped by dishonest tax preparers. Two options are the AARP Foundation tax-aid finder and the IRS directory of tax specialists.

If You Don't Know Who's Calling, Don't Answer

Since scammers frequently contact people over the phone, Efstathopoulos advises against disclosing details about incoming calls.

This makes it simpler to confirm that you are speaking with a legitimate person. Generally speaking, banks don't call unless there is questionable activity on your account or if you've already been in touch with them over an issue.

If you often receive unfamiliar calls that turn out to be robocalls or fraudsters, Nofziger suggests utilizing your phone's built-in spam-blocking features. For iPhone and Android users, see here and here on how to accomplish this.