As the story went, the Internal Revenue Service was threatening people who had not filed their income tax returns by Jan. 31 with $10,000 fines.
The story was a hoax, of course. But similar threats are often treated as real, with terrified recipients of bogus emails and phone calls taking a panicky road to losing money.
Tax scams are high on the list of ploys that scammers use to try to steal identities. Dollar losses run into the billions every year. The IRS says scammers who call potential victims often:
— Know the last four digits of the victim’s Social Security number;
— Make caller ID appear that the IRS is really calling;
— Send fake emails to reinforce the scam;
— Use common names, phony IRS badge numbers and threaten victims with jail time or revocation of their drivers licenses;
— Call again, claiming to be police or the Department of Motor Vehicles — and caller ID again that appears to back them up.
Scammers who call with a little of your personal information can prompt you to give them enough data to steal your identity and file a false return. The IRS is watching for such fraud, but it’s still a major problem.
Federal officials advise, if you get such a phone call and you owe or think you might owe taxes, hang up and call the IRS at 800-829-1040. IRS staff can help answer your payment questions. If you don’t owe taxes and get such a call, report it to the Treasury Inspector General for Tax Administration at 800-366-4484.
You can also file a complaint with the Federal Trade Commission at FTC.gov. Include “IRS Telephone Scam” in your comments.
Businesses may be targets of scammers, too. Owners should watch for offers that are too good to be true (they are) or that require fees in advance. Reject any claim that “the IRS is giving away money” or that you can use outlandish write-offs. Also avoid “consultants” who want to create dummy corporations, hide money offshore or divert funds into trusts as tax dodges.
Scammers rifle through tax liens to see who’s in trouble, then offer “relief,” which means you pay them and get nothing. Some tax preparers can get you in trouble; they may make false claims to get a healthy return deposited to a bank account, then cut you a check for a fraction of the amount.
If someone else prepares your return, read it before signing; it’s still your responsibility to see that everything’s accurate. Don’t do business with a preparer who asks for a percentage of the refund you’re expecting. Do research on the preparer’s track record. Look for a Tax Preparer Identification Number (issued by the IRS) on your return. And never agree to have your return deposited in the preparer’s account.
Learn more about tax scams online at http://www.irs.gov/uac/Tax-Scams-Consumer-Alerts.
Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer 04412, visit http://necontact.wordpress.com or email firstname.lastname@example.org.