Tax Preparation

Keep away from tax fraud | opinion

Tax season is upon us, which means tax prep websites are popping up on every corner. It’s that time of year when you’re looking forward to your tax refund, but beware, tax season is also popular scam season.

According to McAfee’s 2021 Consumer Security Mindset Report (https://www.mcafee.com/en-us/consumer-support/consumer-security-mindset.html), about 63% of Americans plan to do their taxes online this year take care of. Of these applicants, approximately 12% will be filing their tax returns online for the first time.

The IRS has reported a rise in tax fraud such as phishing and phone scams, but the following tips can help you avoid becoming a victim:

1. Try to file your tax returns early during tax filing season. You should prioritize preparing and submitting them as soon as possible. Each year, the IRS identifies multiple identity theft cases in which scammers use stolen personal information, including Social Security numbers, to file a tax return early in the season so they can seek a refund.

The sooner you submit, the less chance scammers will pretend to be you. If the IRS marks your tax return as a duplicate, or you can’t file it via email because the system says you already filed it, you will likely need to fill out and file the IRS’ identity theft form. That could mean your refund

will be delayed until proper documentation is verified and duplication is resolved by the IRS.

2. Learn how to spot a phone scam. With the pandemic resulting in most of us conducting business over the phone and online, it’s important that we be extra vigilant when using this method of communication during tax season. Phone-based fraud is rampant.

A caller claiming to be with the IRS and requesting immediate tax payment by credit card or wire transfer is just one example. They could threaten to send authorities to your home. Other possible threats include having your driver’s license or business license revoked. Actual IRS representatives will never call for payment or threaten to send the authorities.

A real representative can tell you about your rights as a taxpayer, including the right to contest your bill and get a clear explanation of what you owe.

3. The protection of your personal data is important. This type of scam occurs when an individual steals your personal information. They use the information, including your social security number, to file a tax return on your behalf. Fraudsters then demand the tax refund. You may not find out about the scam until you try to file your tax return. For example, you may not be able to file your tax return because someone has already filed a return using your social security number. ‘

Always try to submit your taxes to a credible tax preparation site. Make sure you check with the IRS to make sure the tax side is legitimate before giving them your personal information. Sometimes scammers pose as tax advisors and offer to help you with your tax return. However, they do not sign the declaration and do not include a Preparer Tax Identification Number (PTIN).

The law requires paid tax advisors to both sign and attach their PTIN. Known as a ghost tax preparer, this type of thief can promise you a hefty refund and ask for more money to prepare the tax return. They could steal your personal information during the process.

4. Try to avoid phishing scams. Phishing scams are on the rise and are another scam tactic commonly used by criminals. Scammers usually send emails that appear to be sent by the IRS. They often lure their targets with false promises of a refund or the threat of an audit. You can also set up a fake website that looks like the real IRS.gov. These fake websites often have the IRS seal and other graphics to make them appear official. Their goal is to trick their victim into revealing personal and financial information. They use the information they receive to steal identities and commit fraud.

The IRS does not contact individuals via email regarding their tax accounts. The agency also does not use email, social media, SMS or fax to contact or ask for personal or financial information.

If you receive such an email, do not click on any link or open any attachments. Don’t let tax fraud ruin your summer. Watch out for phone and phishing email scams using the IRS as bait.

5. If you think you have been the victim of tax fraud, report it as soon as possible. If you believe you have been the victim of fraud or fraud, the IRS should take all necessary steps on its official website, www.irs.gov.

There are other agencies that should also be notified. This includes your state tax authority. If scammers have your information and have filed a fraudulent federal tax return, they will likely file a fraudulent state tax return as well. Resolving these tax disasters can easily take several months or years, not to mention hours of calls and conversations with the IRS. It could be even longer this year.

Tax fraud is big business and you are not immune to the relentless efforts of scammers trying to victimize you. The massive amounts of valuable personal and financial information shared online at this time of year make it a haven for thieves. They are doing everything they can to take full advantage of the opportunities that tax season presents to them. Therefore, at this time of heightened potential for your personal information to be stolen, it is just as important to take steps to use the internet safely.

Remember that your personal information is like money. Fraudsters will continue their tax fraud attempts throughout the year. By making informed decisions about sharing your personal information, filing your tax returns as early as possible, verifying that you are speaking to the IRS, and taking the time to report it, you can stop these identity thieves!

For more information email me at Charlestien.harris@southernpartners.org or call me at 662-624-5776.

See you next week—Stay financially fit!

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