Avoiding Tax Scams

Be wary of threatening telephone calls: That isn’t an IRS agent.

Those menacing phone calls are fake. Those offers of tax relief that sound too good to be true are just that. Beware of unsolicited phone calls from anyone claiming to be from the IRS.

Inside the Numbers

One of the most common scams involves demanding pre-payment of your tax debt through a wire transfer or prepaid debit card. They may even promise to lower your overall payment. The treasury inspector general for tax administration at the IRS reports nearly 100,000 complaints about this type of scam annually. Millions have been stolen by fraudsters, with thousands of victims. Others are promised a tax refund but asked to reveal personal information like a banking account number.

Remain Alert

Scammers often frame their call with a time limit and are often described as pushy and hostile. You may be threatened with arrest, suspension of your license, or deportation if payment isn’t made immediately. The IRS will only make initial contact with taxpayers by mail, and payment is never solicited over the phone. You are never asked for a credit or debit card or any banking information during a call. The IRS also doesn’t demand immediate payment at the risk of any enforcement action.

Telltale Signs

These calls can often seem quite official. A key way for fraudsters to trick the unsuspecting is by reciting the last four digits of a Social Security number as confirmation — but those numbers can be stolen. Scammers may also spoof official IRS caller ID or toll-free numbers, in order to make things look on the up and up. Fake emails may also “confirm” your conversations. Sometimes additional scam calls follow — as others threaten enforcement actions from the department of motor vehicles or the police department. 

What to Do

Don’t answer the phone if you suspect you’ve receiving a scam call. If you answer and realize what’s happening, immediately hang up and contact the authorities. Report scams, bad business practices or fraud at ReportFraud.ftc.gov. If you think someone has stolen your identity, go to IdentityTheft.gov. Unwanted calls should be reported to DoNotCall.gov. In addition to their main offices in Washington, D.C., the Federal Trade Commission also has eight regional offices located in Atlanta, Chicago, Cleveland, Dallas, Los Angeles, New York, San Francisco and Seattle.


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