RSA Tax-related scams in 2018

During the tax filing season, scammers become particularly active, and with the deadline coming closer and closer, you need to be careful. Crooks come up with all kinds of methods to lure out money out of taxpayers, but awareness for these scams is also rising. The IRS (Internal Revenue Service) even has an annual ‘Dirty Dozen’ list with the worst scams of the year, which you can find here. While tax related scams can be encountered throughout the whole year, they are particularly nasty during the filing seasons, which is why people need to be extra cautious. And the best way to make sure you do not become a victim is to familiarize yourself with the types of scams that you may encounter and how to spot them. So here is the information you need to make sure your tax filling goes smoothly.

Phone scams

Phone scams have been around for years, and taxpayers can still encounter them to this day. If you are aware of your tax situation, are familiar with how filling goes and know what IRS can and cannot do, you should be able to spot a scam immediately. Unfortunately, there are people who are not aware of those things, and ultimately end up a victim of a phone scam.

Phone scams usually go like this: you get a phone call from a supposed IRS representative, they claim that you owe the IRS money, ask you to use a specific payment method to transfer the money you allegedly owe (via wire transfer, prepaid debit or gift card), and threaten to report you to law enforcement if you do not comply. These threats can sound very convincing, and a person who is not aware of his/her tax situation, can easily panic.

Oftentimes, scammers obtain peoples’ personal information via phishing, and can have very precise details, such as name and address, which only further convinces victims that it is legitimate. According to the IRS, victims are then often bullied into paying, commonly threatened with arrest, deporting or driver’s license revoking.

And if you are thinking that people do not fall for these scams, we would not be so sure. According to the TIGTA (Treasury Inspector General for Tax Administration), since October 2013, there have been over 12,700 victims who collectively paid over $63 million.

Fortunately, these kinds of scams are very easy to spot if you know what to look for. First of all, the IRS will never call you to ask for immediate payment, whether it is via wire transfer, debit or gift card. Furthermore, you will never be asked to pay without the right to question or appeal the amount you owe. And finally, you will never be threatened with immediate arrest, deportation, etc.

Phishing

While a lot of phishing emails tend to be pretty basic and obvious, some can be quite convincing, thus result in people falling for them. People can get phishing emails with scammers pretending to be from the IRS, asking them to fill in a form for tax payment/refund, etc., and if people fall for this, they essentially give away highly valuable information about themselves. Similarly to phone scams, those phishing emails may also use scare tactics so that people react without thinking too much. They could be threatened with arrest, deportation, etc., as well.

Again, the IRS will never email taxpayers with a bill and a refund. So whenever you get an email that does just that, you can disregard it as spam, delete or ignore it.

Fake tax returns

The IRS has warned about “a quickly growing scam involving erroneous tax refunds being deposited into their bank accounts”. It seems to be an old scam with a new twist, and it could potentially impact thousands of people. The way it works is, scammers fill in fraudulent tax returns using stolen personal information, use taxpayers’ actual bank accounts for the deposit and then try to reclaim the funds from the taxpayers while pretending to be from the IRS.

According to the IRS, one type of scam involves a criminal pretending to be from a debt collection agency working for the IRS and claiming that the funds were transferred in error. If the taxpayer does not return the funds, they are threatened with criminal fraud charges, an arrest warrant and a “blacklisting” of their Social Security Number.

As usual, scare tactics are used to intimidate people but you should be aware that the IRS will never make phone calls of this kind. There are various procedures taxpayers need to follow in order to deal with erroneous funds, but none of them involve getting a threatening phone call with the IRS demanding you immediately transfer them the money. However, there is no doubt that this type of scam will have a lot of victims.

“One of the reasons this scam has been successful is because it deviates from other scams in the initial victim contact,” Crane Hassold, a threat intelligence manager at the security firm PhishLabs, said to the Wired. “Most scams like this start with an initial communication that evokes fear or anxiety. This scam, though, starts with a somewhat plausible action—the ‘erroneous refund’—then follows that up with the fear and anxiety tactics. Because the initial contact is unexpected and could be interpreted as a simple mistake, it likely makes the usual fear and anxiety tactics more effective.”

What the IRS will never do

Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes.

• Threaten to immediately bring in local police or other law-enforcement groups to have the taxpayer arrested for not paying.
• Demand that taxes be paid without giving taxpayers the opportunity to question or appeal the amount owed.
• Ask for credit or debit card numbers over the phone.
• Call you about an unexpected refund.

And if you find yourself with erroneous funds in your account, go the official IRS website to find out how you should proceed.