Watch Out for Tax Scams All Year Long by Adam Cohen, CPA
Posted on December 23, 2019
by
Adam Cohen
According to the IRS, gift card scams are on the rise as thieves look for new ways to swindle people out of money and/or steal their identities. The best ways to protect yourself from becoming a victim is to stay vigilant, recognize the warning signs, and think before you give away any of your personal information or engage in questionable behavior with your taxes.
In the currently circulating gift card scam, taxpayers receive telephone calls from criminals posing IRS agents and claiming that taxpayers’ identities have been stolen and used to open fake bank accounts. The bogus agents advise taxpayers to buy gift cards from various stores and await further instructions. In time, the scammers call the taxpayers back asking them to provide the gift cards’ access numbers.
How to Spot Scams
The first sign to tip taxpayers off that they are the subject of a potential scam is that the caller professes to be an IRS agent. The IRS will never initiate contact with a taxpayer by phone, email or text. Generally, the agency will first mail a notice or bill to any taxpayer who owes taxes. In addition, taxpayers should remember that the IRS will never do the following:
- Demand immediate payment using a specific payment method, such as a prepaid debit card, gift card or wire transfer;
- Ask a taxpayer to make a payment to a person or organization other than the U.S. Treasury;
- Threaten to call local police, immigration officers or other law-enforcement agencies to arrest or deport a taxpayer;
- Threaten
- Demand taxes be paid without giving the taxpayer the opportunity to question or appeal the amount owed;
- Threaten to revoke a taxpayer’s driver’s license, business licenses or immigration status.
Over the years, criminals have also perfected the use of phishing scams to trick taxpayers into revealing their personal information, including financial accounts and passwords, or clicking on fake links to enable thieves to capture this data. These websites and unsolicited emails are so carefully designed that taxpayers may easy mistake them as legitimate. To avoid getting hooked by a phishing scam, look out for the following warning signs:
- The scammer poses as a trusted bank, favorite retail store, government agency or even a tax professional.
- The scammer insists that there is a problem with your account or alleges that you are in violation of a law.
- You are instructed to open a link in email or download an attachment.
- You receive an email asking you to log into your account on a familiar-looking – but fake – website.
Proceed with caution anytime you receive an unsolicited email. Rather than sending an immediate reply or clicking on links found in the body of the message, take a few minutes to think about the potential repercussions of those actions. Instead, pick up the phone to call the purported sender at a verified telephone number or open a separate browser window, type in the correct URL website address you have on file for that business, agency or individual, and only then use your credentials to log into your account.
About the Author: Adam Cohen, CPA, is an associate director of Tax Services with Berkowitz Pollack Brant, where he works with closely held businesses and non-profit charities, hospitals and family foundations to maintain tax efficiency and comply with federal and state regulations. He can be reached at the CPA firm’s Ft. Lauderdale, Fla., office at (954) 712-7000 or via e-mail at info@bpbcpa.com.
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