If it’s January, it must be income-tax preparation season. Oh joy. As one who’s been the victim of a tax scam, I’m doing my homework to avoid problems.
Thieves are stealing tax information and filing for fake refunds year round. It’s a big business and they are constantly trying to plunder your tax records. It’s prime time for them now.
I’m not sure how my tax records were stolen, but when I received notice of a tax refund — I wasn’t due one that year — several alarm bells went off. Then I went into cybersecurity mode.
Here are six red flags from the IRS and how you can avoid getting scammed:
1). “Your attempt to file your tax return electronically is rejected.” You get a message saying a return with a duplicate Social Security number has been filed. First, check to make sure you did not transpose any numbers.
Also, make sure one of your dependents, for example, your college-age child, did not file a tax return and claim themselves. If your information is accurate, and you still can’t successfully e-file because of a duplicate Social Security Number (SSN), you may be a victim of identity theft.”
Think you were scammed? You have to tell the IRS right away by filing form 14039, the “identity theft affidavit.” The IRS will get back to you with mailed instructions on what you need to do next. I did that, although the confirmation by mail took a few weeks.
2).“You receive a letter from the IRS asking you to verify whether you sent a tax return bearing your name and SSN.” The IRS holds suspicious tax returns and sends taxpayers letters to verify them. If you did not file the tax return, follow the instructions in the IRS letter immediately.”
Keep in mind the IRS doesn’t call or email out of the blue. Look for their letters and call them back. Also ask the IRS for your Personal Identification Number (PIN) so that you can safely file electronically. I just received mine last month.
3). “You receive income information at tax time from an employer unknown to you. Employment-related identity theft involves the use of your SSN by someone, generally an undocumented worker, for employment purposes only.”
Someone is scamming you to get a false refund. Notify the IRS immediately.
4). “You receive a tax refund that you did not request.” You may receive a paper refund check by mail that the thief intended to have sent elsewhere. If you receive a tax refund you did not request, return it to the IRS.
Write “VOID” in the endorsement section, and include a note on why you are returning it. If it is a direct deposit refund that you did not request, contact your bank and ask them to return it to the IRS. Search IRS.gov for “Returning an Erroneous Refund” for more information.”
I received one of these big checks based on a false refund. Although I would’ve loved to have cashed it, I knew that it was wrong, so I returned it to the Treasury Department un-endorsed and notified the IRS.
5). “You receive a tax transcript by mail that you did not request.” Identity thieves sometimes try to test the validity of the personal data they have chosen or they attempt to use your data to steal even more information. If you receive a tax transcript in the mail and you did not request it, be alert to the possibility of identity theft.”
Again, thieves love the “verification” ruse to phish for financial information that they can steal. Don’t send SSNs or any bank account numbers to unknown addresses.
6). “You receive a re-loadable, pre-paid debit card in the mail that you did not request.” Identity thieves sometimes use your name and address to create an account for a re-loadable prepaid debit card that they use for various schemes, including tax-related identity theft.”
The IRS doesn’t send out debit cards, either. If you’re due a refund — and it’s legitimate — it should match up with your tax forms.
I know a lot of folks don’t like to hear this, but I’ve found the IRS to be helpful in sorting out my tax scam matters. You may not always be able to get through to them quickly, but you can get plenty of additional information on their website.