During the tax preparation season, the IRS, state tax agencies and the tax industry remind people to be vigilant with their personal information. Cyber criminals are constantly searching for Social Security Numbers and other personal information that they can leverage for fraudulent purposes. Because identify theft and tax-refund fraud often starts long before tax season, it’s important to protect your personal and financial information year-round.
With the April 15 deadline approaching, millions of Americans are finalizing the preparation and filing of their taxes. Unfortunately, tax season is a busy time for cyber criminals and scammers as well. Tax-refund fraud is a serious and fast-growing problem.
Tax-refund fraud happens when a cybercriminal steals someone’s personal information to file a fake tax return and to claim that individual’s the refund. To file a tax return online, they only need a name, date of birth, and a Social Security Number.
SCAMS TARGETING TAXPAYERS:
The IRS has a seen a surge in cybercriminal swindles directed at consumers. If you protect yourself against these unscrupulous schemes, your identity and tax return will be safer and more secure. IRS-IMPERSONATION PHONE SCAMS Callers claiming to be IRS employees – using fake names and phony IRS ID numbers – may ring you and insist that you owe money and it must be paid as soon as possible through a gift card or wire service. If the call is not picked up, the scammers often leave an emergency callback request message. The real IRS will not call you and demand immediate payment; in general, it will mail you a bill if you owe money. MARKED INCREASE IN PHISHING,
EMAIL AND MALWARE SCHEMES:
Cybercriminals will try to get you to do something, so they can steal your personal information. Watch out for unsolicited emails, text messages, social media posts or fake websites that may prompt you to click on a link or to share valuable personal and financial information. Armed with this information, online thieves can pilfer funds and/or commit identity theft. And unfamiliar links or attachments can contain malware – viruses, spyware and other unwanted software that gets installed on your computer or mobile device without your consent – which can infect your computer files if opened.
FRAUDULENT TAX RETURNS:
The FTC strongly recommends trying to file your tax return as soon as possible. The IRS only accepts one tax return per Social Security number. If the file is yours and it’s in early, it becomes impossible for a fraudster to submit another return with your personal information. It’s also important to always use smart practices with your personal information. Remember to only share your Social Security number when it’s absolutely necessary. Check your credit report regularly for shady activity, and never throw papers with critical information – like your Social Security number or bank account information – in the trash. It’s best to shred all paper containing personal data.
TAX PREPARER FRAUD:
The overwhelming majority of tax preparers provide honest services, but some unsavory individuals may target unsuspecting taxpayers and the result can be refund fraud and/or identity theft. The IRS reminds anyone filing a tax return that their preparer must sign it with their IRS preparer identification number. Here are some tips to protect yourself and your loved ones from tax-refund fraud:
- Don’t give out your personal information, unless it is to a trusted entity. The Internal Revenue Service (IRS) does not initiate contact with taxpayers by email, text messages, or social media to request personal or financial information. If you receive an unsolicited email claiming to be from the IRS, do not click on any links or reply. Instead, forward it to firstname.lastname@example.org and delete it from your inbox.
- Look out for phony messages or websites claiming to be from the IRS or tax preparation services. Exercise caution when opening suspicious email attachments and do not click on web links in unsolicited email messages. Scammers who try to access your personal or financial information may use the IRS name or logo in email messages and on fake websites to lure potential victims.
- Beware of promises of “free money” from inflated refunds. Scammers frequently pose as tax preparers during tax season. If you are contacted by someone who promises a large tax refund or a refund you are not expecting, do not give out any personal or financial information. If the offer seems too good to be true, it probably is.
- Back up your data and store your electronic tax files securely. Last year, most Americans opted to file their taxes online. When preparing your tax return for electronic filing, make sure to use a strong password. If you are working with an accountant, ask them what security measures they have in place to protect your personal information.
- Only share personal information over a secured network. Criminals increasingly are using free public Wi-Fi and poorly secured network access points to intercept and steal information. Even if you are at home and logging into to a wireless network, make sure you only join a properly secured password-protected network. For all my financial transactions I don’t connect if the network is publicly available and recommend you consider similar precautions. Remember: using free public Wi-Fi makes it easy for cyber criminals to intercept and steal your information. Never prepare your tax return or conduct other online activities such as banking and shopping when connected to an unsecured wireless network.
If you believe you have been the victim of tax-refund fraud, contact the IRS. If you have been a victim of identity theft in general, report such incidents to the Federal Trade Commission at www.consumer.gov/idtheft, or to the FTC Identity Theft hotline at 1-877-438-4338.
Everyone must play their part to stay safe online during tax season and all year round. To learn more about how to protect your information during tax season, visit: www.irs.gov/Individuals/Identity-Protection.
For additional general cyber tips and resources, visit www.dhs.gov/stopthinkconnect.
April 15th rapidly is approaching. Be safe and securely file your taxes this year!