Are you aware of these common tax preparation scams?
As if it’s not bad enough you might owe the IRS money, scammers who conduct tax preparation scams are looking to take advantage of you. They want your refund and possibly even your personal information. It’s important to know the signs of a dishonest tax preparation practice.
Here are three common tax preparation scams to watch out for:
1. Email Advertising for Tax Preparation
People impersonate tax preparation professionals and state they’re from a legitimate tax business. These fraudsters often claim they can conduct the entire process via phone or email. However, this claim in itself should raise a red flag to consumers. It is likely that a scammer such as this will either not prepare the taxes at all, while still charging you, or may complete the taxes incorrectly.
Additionally, it is important not to trust someone who claims they will do your taxes online without needing to meet you in person—no matter how convenient the service seems. On the flip side, you also don’t want to trust someone from a website or e-mail message who says they will meet you somewhere other than an official place of business. Although some people work from home as tax preparers, they know not to advertise by sending you an email if they’re legitimate.
Furthermore, you want to be wary of people who email you and state they are independent business owners preparing taxes, especially if they don’t have an official business website. To protect your personal information, it’s best not to respond to the email at all and mark it as spam. Never respond to an email if it’s from an unknown email address. This is the way scammers phish as well. They can access your personal and financial information and then use it to steal your identity.
2. Email Claiming the IRS Is Withholding Funds
Not everybody trusts the government, especially the IRS. For this reason, people send out emails claiming there’s money waiting from the government that’s owed to them by the IRS due to over taxing. The emails claim the only way to retrieve the money is to input personal information.
In cases such as this, the scammer typically has the victim’s social security number and can file a fake tax return and have the refund sent to a false address. This will prevent you from being able to file when the time comes. Not to mention, once the scammer has your info, he or she has the potential to use it for even more damage such as opening a credit card under your name.
3. Email Asking You to Update Your Info
The IRS isn’t typically going to email you anything regarding your taxes besides a confirmation email. If the IRS requires additional information from you, they’re not going to email you and ask you to input information because they know how scammers use this tactic to acquire information. The IRS tends to send mail regarding your account.
You should also be leery of anyone who calls or emails, demanding payment to the IRS quickly. When you really do owe the IRS, nobody is going to rush you into paying the balance before you receive any type of printed statement regarding payment. Not to mention, the IRS isn’t going to rush you into paying the balance in the first few months.
You do have a certain amount of time to pay and are even able to make payments. The emails and calls meant to evoke fear are never from the real IRS.
Watch out for these tax preparation scams and do what you can to protect yourself. The best way to get your taxes done is to entrust the job to a professional you can meet and know longterm. If you’d like help with your tax preparation, let’s schedule a consultation now.