Tax scams are becoming more and more prevalent and sophisticated. With the rise of online filing and payments, it is easier than ever for criminals to find and access information needed to defraud taxpayers. Criminals have become very skilled at disguising their criminal activities as legitimate tax business. The IRS has identified the “Dirty Dozen” tax scams, which are becoming ever more popular.
1. (Phishing): Phishing is a scam in which a criminal sends out phony emails or text messages that appear to be from the IRS. These messages will typically contain links to fake websites or ask taxpayers to provide personal information that can then be used to steal their identities or access their bank accounts. It is important that taxpayers never respond to unsolicited emails purportedly from the IRS and always correct their email address before forwarding an email appearing to be from the IRS.
2. (Identity Theft): Identity theft is a serious crime in which criminals use stolen personal or financial information to access funds, commit fraud, or open accounts in another person’s name. It is important to protect yourself against identity theft by protecting your personal information and safeguarding your computer and mobile devices.
3. (Return Preparer FRAUD): Return preparer fraud occurs when a tax preparer falsifies information on a tax return to claim large refunds or take advantage of select credits or deductions. It is important to be vigilant in selecting a return preparer and remember that only a licensed professional should be used to prepare tax returns.
4. (Inflated Refund Claims): Inflated refund claims occur when tax preparers offer false promises of huge refunds. It is important to avoid these false promises and know that the IRS does not condone or permit these types of false promises.
5. (Fake Charities): Fake charities are organizations that are established to deceive or defraud taxpayers. It is important to research a charity before donating so that you are sure that your donation is going to a legitimate organization.
The best way for taxpayers to protect themselves from tax fraud is to always research any tax advice they are given and to be sure that all tax returns are filed honestly and accurately. The IRS also encourages taxpayers to be alert and to use its website to help them protect themselves from criminals.