Tax Scams and Consumer Alerts

Tax scams have continued on a meteoric rise and show little plans of slowing down. Some scams to look out for include COVID-19 related phishing scams, IRS impersonation telephone scams, “ghost” tax return preparers, and many other scams.

COVID-19 has given rise to evolving phishing scams that use emails to trick the person receiving the message into disclosing personal information including passwords, bank account numbers, credit card numbers, and social security numbers. These phishing emails can appear to come from a “trusted source” such as a colleague, bank, even the IRS itself. Spear phishing is a targeted attack, where the scammer takes time to learn about their victim to create a more enticing email so that when the victim opens an attachment Malware is loaded onto the victim’s computer. This allows the scammers to be able to change the banking information for the victim’s tax return.

IRS impersonation telephone scams are as common as hitting the snooze button on your alarm clock in the morning. It’s a daily occurrence. Remember that the IRS will never:

· Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card, or wire transfer.

· Threaten to immediately bring in local police or other law enforcement groups to have the taxpayer arrested for not paying.

· Demand that taxes be paid without giving taxpayers the opportunity to question or appeal the amount owed.

· Call unexpectedly about a tax refund.

A Ghost Tax Return Preparer is someone whose refusal to sign returns can cause a list of frightening problems for the taxpayer that is ultimately responsible. By law, anyone that is paid to prepare or assist in preparing federal tax returns must have a valid Preparer Tax Identification Number (PTIN). Preparers must sign and include their PTIN on the return.

For a more comprehensive list of common scams please visit Tax Scams / Consumer Alerts | Internal Revenue Service (irs.gov).

The professionals at the Center for Financial, Legal, and Tax Planning, Inc., are more than knowledgeable in tax law and common tax scams. Please contact us at (618) 997-3436 for more information