Fraudulent tax return filing is the most common tax crime people face this year. Scammers use victims’ stolen information to file false tax returns on their behalf, claiming exaggerated credits and deduction. The scammers then send the false return to the IRS.
When the IRS receives the return filed by the scammers, many are processed without delay. In some cases, the IRS issues huge refunds to the postal address or the bank account included in the return. Since the scammers provided this information in the return, the refund reaches them and not the taxpayer. Even if the IRS discovers inaccuracies with what is filed, they will contact the person via the contact information listed on the return. It is only when the identity theft is discovered that the long process of correction the problem begins.
Scammers are typically after personal and tax-specific information from their victims, such as their name date of birth, Social Security number, and filing status. Therefore, taxpayers need to keep this information safe. This can be accomplished by keeping tax-related information off of the Internet and away from people who they don’t know. The simplest way to avoid tax-related identity theft is to file the return early in the tax season. After your tax return has reached the IRS, the scammers will not be able to file a fraudulent tax return even if they steal your information.
Some communication mediums that are used to target taxpayers include phone calls, emails, social networking sites, and text messages. They usually use the name of a well-known organization such as the IRS, the FTC, a bank, etc. to gain taxpayers’ trust. Do not reply to information requests unless you are certain about the authenticity of the organization or the person contacting you. Instead, get the contact information of the organization using a trusted source, such as their website. Exercising caution will go a long way in ensuring that you are safe from scammers throughout the year.