St. Patrick’s Day is this week and while you’re deciding whether or not you have a green shirt appropriate for work, thieves are working to steal the pot of gold you plan to get back from the federal government. It’s time to file your taxes and scammers are looking for ways to get their hands on your refund. Some of the most common scams involve stealing your identity. Here are three you should be aware of.
Tax Refund Fraud
You submit your tax return online. You receive a notification that your taxes have already been filed and the refund paid. A scammer has filed a tax return pretending to be you and stolen your refund. That isn’t the only thing they’ve stolen. They have to have your Personally Identifiable Information (PII) to file a tax return; specifically, your name, Social Security number and birthdate. This means they’ve stolen you identity too. To prevent this, keep your PII both secret and secured. It’s also a wise choice to file your taxes as soon as you receive all the necessary documents, like W-2s, 1099s, etc. Here is a checklist.
IRS Imposter
You receive a call from someone who presents themselves as an official. They say you owe unpaid taxes. You want to both act with integrity and stay out of trouble, so you’re inclined to answer their invasive questions about your PII. Right now you may be thinking, “This is old news. Fraudsters have been doing this for years.” And you’d be right. But if you see the words Internal Revenue Service (IRS) on your caller ID, it makes the scam seem legitimate, doesn’t it? Scammers get more sophisticated every year and experienced ones use spoofing to disguise themselves. To prevent this, remember that the IRS does not contact you through a phone call, text, email, or social media. If they want to get ahold of you they will snail mail you a letter. If you want to double check after receiving a communication other than a letter, call them at (800) 829-1040 and tell them what happened.
Stolen Unemployment Benefits
You lost your job thanks to COVID-19 and received unemployment benefits from your state in 2021. That money is taxable by the federal government. You received an IRS Form 1099-G. Box 1 on this form lists an amount of money you did not receive, or the amount listed is more than you received, or you did not apply for unemployment benefits from the state that sent you the form. A criminal has stolen your identity and used it to file for unemployment benefits. To prevent this, if you receive a text message or email from someone claiming to be from a state workforce agency and it contains a link to a website, do not click on the link. The message is from a scammer who is trying to trick you into going to their fake website. They want you to think that you’re applying for unemployment benefits on this site, but what you’re really doing is giving them the PII they need to steal your identity. If you receive a text or email like that, report it here.
Here is a longer list of current tax scams the IRS is keeping an eye on. What do you do to protect yourself from tax fraud? Please share in the comments.