This is an expanded version of a post I wrote last year. It’s a hot topic every winter/spring, so I thought it might be a good time to revisit.
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I’m going to amend an old saying right now: in this world nothing can be said to be certain, except death, taxes and tax season scams.
It happens every single year now, from January through April: tax-related scams absolutely run riot, from emails and phone calls to shady tax preparers and rogue employees.
There are some easy ways to keep yourself safe, though.
The IRS Will Not Email You
There is no scenario in which the IRS is going to send you an email. Even if you used online tax software to e-file your return, they are never going to contact you in this way if there’s a problem with your filing. They will contact you via telephone or, in most cases, use postal mail.
This is a vitally important point to remember. Do you know what the #1 email scam was in 2009? It was phishing emails designed to look like they came from the IRS. If you get one, forward it to email@example.com and help them fight these scams, and never open attachments in an unexpected email unless you want to be infected with spyware or to allow a criminal to access and control your computer.
The IRS Will Not Ask You to Verify Information
Even if there is a problem with your return, or you’ve been selected for an audit, the IRS is not going to ask you to “verify” your personal information. This goes for any mode of communication, electronic or otherwise.
Here’s the deal: they’re the IRS. They don’t need to ask you for your personal information. They already know who you are, when you were born and what your Social Security Number is.
Don’t Trust Caller ID
I’ve never even heard of anyone getting a phone call from the IRS, but my sources say it does happen. However, the time when you could implicitly trust caller ID is long gone. It’s easy to spoof a caller ID display using Voice Over Internet Protocol (VoIP).
If the caller ID says Internal Revenue Service, but they’re asking you to verify your personal information, bank account or credit card numbers, you’re dealing with a scam. Hang up immediately.
The IRS Keeps Pretty Normal Business Hours
In addition to being wary of caller ID, also know that the IRS isn’t going to call you on the telephone in the middle of the night.
This same rule goes for callers that claim to represent your banking institution. How many times have you seen a bank open at 3 AM? Not often. Phone calls at strange times are a sure sign of a scam.
Know Your Tax Preparer
If you’re paying someone else to prepare your tax return, only deal with people or businesses you know and trust. If it’s a friend or relative, make sure they know what they’re doing. It doesn’t matter who prepared your return—you are ultimately responsible for the filing.
Personally, I think it’s best to have a person you always go to. A couple years ago there was a case in Northwest Indiana where dozens of people had their identities stolen by some rogue employees of a national tax preparation company. If you’re not doing your own taxes at home, I recommend using a CPA you know personally (or can get to know over time).
Be Wary of Big Promises
When you’re shopping for a tax prep person or agency, be cautious of anyone making wild claims about the money they can get for you. Remember: you’re the one whose name and signature go on that tax return. If they put some giant fabrication on that form, and you sign it, that means you agreed it was accurate. You’ll be the one in trouble when you’re found out.