Tips & Advice

Beware! Income tax fraudsters may call you

Presented by Larry Larsen, Director of Cyber Security

I got a phone call the other day from a guy saying he was with the Internal Revenue Service. The caller promptly told me there were "Special Agents" on their way to arrest me unless I gave him a credit card number to cover the taxes and penalties I owed. Knowing that the call was a scam, I told the caller that I’d have coffee and cookies waiting for the agents when they arrived to arrest me.

He hung up.

Now, I’ve worked with Federal agencies and law enforcement enough to know that’s not how they operate. Unfortunately, many citizens are fooled and they fall victim to this phone fraud, and others like it, to the tune of millions of dollars stolen from their accounts.

The IRS – like Microsoft, Bill Gates and that prince in Nigeria – will NEVER email or call out of the blue to ask for your personal information. Just accept that and hang up when they do.

It’s surprising, but the IRS is one of the friendliest agencies to deal with if there is a problem with your taxes or your account. They also maintain a robust Consumer Alerts section on their website that's frequently updated as new threats and scams emerge.

With the infamous ‘tax day’ on the horizon, let’s look at some of the cons the IRS Criminal Investigation Division is investigating:

IRS-Impersonation Telephone Scams
As mentioned earlier, the bad guys behind these calls count on our ingrained fears of the IRS; using intimidation tactics to get their victims to cooperate. The solution to these calls is simple: hang up. These criminal calls almost always originate from an overseas location, so have no fear of anyone coming to your house or business. Once you hang up, they’ll simply move to the next number on their list.

Scams Targeting Tax Professionals
Tax preparers are increasingly being targeted by criminals. If you think about it, it makes sense; many are seasonal, part-timers with just enough training to get the 1040 filed. Many may be unaware of security concerns. The IRS has great information on their website to help tax professionals educate and protect themselves.

Soliciting W-2 Information from Payroll and Human Resources (HR) Professionals
HR professionals get phishing emails and fraud calls just like everyone else, but with a twist. The criminals have a specific script to obtain an employees’ personal information — usually impersonating the actual employee. They then use that data to file a fraudulent tax return or commit another identity-theft style crime.

Taxpayer Advocacy Panel (TAP) Scam
This is a fairly unique scheme, in which the bad guys send phishing emails claiming to be a TAP representative (a volunteer board that advises the IRS on taxpayer issues). The email typically references a refund problem. If you get an email like this, forward it to phishing@irs.gov and they’ll take care of it.

In a world where phishing schemes are commonplace, it’s very important to stay informed and stay safe. Exercise your best judgment. When a phone call seems suspicious, don’t be afraid to hang up, and consider blocking the number too. Disconnecting the call is your best defense against phone fraud.