Have you ever received a phone call or text message from someone claiming to be from the IRS, threatening you to pay a past due balance immediately and if you don’t pay, a warrant will be issued for your arrest? I’ve gotten a few of these calls in the past and to be honest, I was a caught off guard initially and felt my heart race with the thought of being in trouble for tax evasion! But as quickly as that fear poured over me, I noticed my gut feeling telling me that this wasn’t right and to hang up the phone.
IRS scams like this have been circulating for years and are ever changing in the hopes that more people will give into their fear and divulge payment, account or personal information. According to NerdWallet, criminals impersonate IRS agents, official employees, or debt collectors to trick you into sending them money for taxes, penalties, or fees that you don’t actually owe. Thousands of people have lost millions of dollars to these scams, and we at AFM do not want to see you fall victim.
Here are some things to keep in mind this tax season. The IRS will never:
- Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer – they will first mail a bill to any taxpayer who owes money
- Threaten to immediately bring in local police or other law enforcement
- Demand that taxes be paid without giving the taxpayer the opportunity to question or appeal
- Call unexpectedly about a tax refund
The NerdWallet article, Latest IRS Scams: How to Spot Them and Fight Back (Sabrina Parys, Tina Orem) gives us valuable information as to what the latest scams are, because at first glance, these can seem legitimate!
The latest IRS scams
Have any of these happened to you?
- ‘We recalculated your tax refund, and you need to fill out this form’
These scam emails display the IRS logo and use subject lines such as “Tax Refund Payment” or “Recalculation of your tax refund payment.” It asks people to click a link and provide their Social Security numbers, birthday, address, driver’s license number and other personal information in order to submit a fake form to allegedly claim their refund.
- ‘We’re calling from the FDIC, and we need your bank information’
The Federal Depository Insurance Corporation insures bank deposits so that consumers won’t lose all of their money if a bank fails. But it does not send unsolicited correspondence asking for money, sensitive personal information, bank account information, credit and debit card numbers, Social Security numbers or passwords. Scammers claiming to be from the FDIC are hunting for information they can use to commit fraud or sell identities.
- ‘We’re calling to tell you your identity was stolen; you need to buy some gift cards to fix it’
In this trick, a criminal calls the victim and poses as an IRS agent. The criminal claims the victim’s identity has been stolen and that it was used to open fake bank accounts. The caller then tells the taxpayer to go buy certain gift cards; later, the crook gets back in touch and asks for the gift card access numbers.
- ‘We’ll cancel your Social Security number’
In this IRS scam, the criminal contacts the victim and claims that he or she can suspend or cancel the victim’s Social Security number.
“If taxpayers receive a call threatening to suspend their SSN for an unpaid tax bill, they should just hang up,” the IRS says.
- ‘This is the Bureau of Tax Enforcement, and we’re putting a lien or levy on your assets’
There is no Bureau of Tax Enforcement. Victims often receive a letter from the fake agency claiming that they have a tax lien or tax levy and that they had better pay the “Bureau of Tax Enforcement” or else.
- ‘If you don’t call us back, you’ll be arrested’
Criminals can make a caller ID phone number look like it’s coming from anywhere — including from the IRS, the local police, or some other intimidating source. But the IRS doesn’t leave prerecorded voicemails, especially ones that claim to be urgent or are threatening. Also, the IRS can’t revoke your driver’s license, business licenses or immigration status.
- ‘Use this Form W-8BEN to give us personal data’
Although the Form W-8BEN, which is called a “Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding,” is a legitimate IRS form, criminals have been modifying the form to ask for personal information such as mother’s maiden name, passport numbers and PIN numbers. (The real form is here.)
- ‘Click here to see some details about your tax refund’
These emails are intended to trick the reader into clicking on links that lead to a fake IRS-like website and expose the user to malware. The IRS never emails taxpayers about the status of their tax refunds. (We’ve collected in one place the links to track the status of your tax refund directly with the IRS or your state’s tax authority.)
- ‘We’re from the Taxpayer Advocate Service, and we need some information’
The Taxpayer Advocate Service is a legitimate organization within the IRS that helps people get assistance with IRS problems. But it doesn’t call taxpayers for no reason. Criminals are making phone calls look like they’re coming from the TAS office in Houston or Brooklyn, according to the IRS. When taxpayers return the calls — which often tell victims they’re entitled to a large tax refund — the criminals ask for personal information such as a Social Security number.
- ‘Click on this to see your tax transcript’
In this scam, fraudsters send an email with an attachment they claim is the taxpayer’s tax transcript. (A tax transcript is a summary of a person’s tax return.) Although tax transcripts are a real thing that the IRS provides, the IRS does not email tax transcripts. You can request one directly from the IRS, which it will then mail to you.
- ‘Take this FBI survey’
This is a ransomware scheme in which criminals email messages that appear to be from the IRS or FBI. When readers click on a link to a survey that the message claims is required, the link downloads ransomware that prevents users from accessing data on their devices unless they pay off the fraudsters.
- ‘You owe the Federal Student Tax’
There is no federal student tax.
- ‘We don’t need to sign your tax return even though we prepared it’
Anyone you pay to prepare your tax return must have a valid Preparer Tax Identification Number and must sign your tax return. Reluctance to sign your return is a red flag that the person is a “ghost preparer” who just wants to charge you a fee and split.
But what if I really do owe the IRS money?
If you think you might owe money to the IRS, you can check that directly with the IRS (and for free) by visiting https://www.irs.gov/payments/view-your-tax-account. If you do owe back taxes and want to make a payment, you can send money directly to the IRS or sign up for an installment plan to pay the IRS over time. All of those things you can do yourself directly with the IRS.
If you spot a potential scam, the IRS recommends you:
- Record the number and hang up immediately
- Report the call to TIGTA using their IRS Impersonation Scam Reporting form or by calling 800-366-4484
- Report the number to firstname.lastname@example.org and be sure to put “IRS Phone Scam” in the subject line
If you have let your guard down, don’t beat yourself up and keep it to yourself, please let us or someone you trust know. AFM is here to help you in this situation and recommend that you notify your financial advising team as soon as possible so that we can take action to protect your accounts and provide you with additional resources.
Presented by Chaunté Stallworth