Scammers use many methods to get your money. Here's what to look out for at tax time
In the next few days, many of us will receive a W-2 Wage and Tax Statement Form from our employer. That is usually the trigger to begin working on filing our income tax returns.
It can also initiate all types of scams and fraud attempts. The Internal Revenue Service and the Consumer Financial Protection Board (CFPB) warn of scams and other fraudulent activity they begin to see as patterns or recurrences. Here are a few things to have on your radar.
Beware of abusive return preparers
Many people could prepare their own tax return, but they feel more confident having someone else prepare the document for them. Be careful when choosing a tax preparer. Most provide excellent service and do so in an ethical manner. However, some do not have your best interest in mind and are looking for a way to cheat the system.
These preparers file false and fraudulent tax returns and ultimately defraud their clients. According to the IRS, even if someone else prepares your return, you are ultimately responsible for all the information on the tax return. Be certain you agree with all the numbers provided on your return before you sign it for submission.
Recognize abusive tax schemes
As we get a little closer to April 15, the emails, texts and phone calls will become more frequent.
You are likely familiar with phishing. This technique has been around for decades, using email to attempt to gain personal information. But hackers use a variety of techniques that are less obvious and more sophisticated all the time. Just remind yourself if it sounds too good to be true, it most likely is too good to be true. Likewise, if it is threatening enough to make you nervous or downright scared, it likely is not true information. The scammers count on our emotional reaction to override our logical thought process.
A more recent type of scam will arrive through text message. This is called smishing because of the term “SMS message.” We don’t use SMS in our everyday language — we just say text. This will likely be some type of warning about a problem with a link to the solution. If you get one of these messages, don't reply or click the link. Report any scam by sending the email or a copy of the text to phishing@irs.gov.
The IRS never initiates contact with taxpayers by email, text or social media regarding a bill or tax refund. Usually, the first communication from the IRS will be a letter. Therefore, some scammers will send actual letters. You can easily log in to the IRS.gov website with your ID.me account information to see a copy of any notice or letter in your file. There is also a section of the IRS website called Understanding Your IRS Notice or Letter that shows examples of common letters that are truly sent from the IRS.
After first mailing a notice or letter to a taxpayer, IRS agents may call to confirm an appointment or discuss items for a scheduled audit. Know that these will not be pre-recorded messages. Also, they will never threaten to arrest a person for not complying.
In 2023, the IRS announced a major policy change that will end most unannounced visits to taxpayers by agency revenue officers. They are hoping this will reduce public confusion and enhance overall safety measures for taxpayers and employees.
Today I’ll leave you with this quote from Maria Konnikova: “Fraud really thrives in moments of great social change and transition. We're in the midst of a technological revolution. That gives con artists huge opportunities. People lose their frame of reference for what can and can't be real.”
Emily Marrison is an OSU Extension Family & Consumer Sciences Educator and may be reached at 740-622-2265.
This article originally appeared on Coshocton Tribune: Know how to protect yourself from scammers during tax time
