As online tax filing and payment becomes more popular, so does tax fraud targeting unsuspecting taxpayers. Here are some common online tax scams to avoid:
phishing scam
Scammers use emails, text messages or phone calls masquerading as agencies or tax preparation software providers to trick people into providing their personal information or clicking links to download malware. The goal of phishing is to steal sensitive information such as social security numbers, bank account information or credit card numbers.
defrauding tax filers
Some tax preparers make false promises to get more business, such as offering inflated tax refunds or basing their fees on a percentage of your refund. They may also promise to help you pay off your debts, or pay off your tax debts for a fraction of the price. Be wary of filers who don't ask for proper documentation, have no verifiable credentials, or don't have a physical office.
fake charity scam
Scammers set up bogus charities and solicit donations during tax season. They may use names that sound legitimate or resemble well-known charities to trick people into giving them money. Research the charity's name and check its tax-exempt status before donating.
social media scam
Scammers may use social media to obtain personal information and use it for identity theft. They may create fake profiles, send friend requests or post fraudulent links. Be careful what you share on social media and verify the identity of any person or organization who contacts you through social media.
identity theft
Tax season is prime time for identity theft, as scammers try to file fake tax returns using stolen personal information. Keep your personal information safe by filing your taxes online using a secure website, destroying sensitive documents, and regularly monitoring credit reports.
Unfortunately, tax scams are common online, and it's important to stay vigilant to avoid becoming a victim.
Top 7 ways to avoid online tax scams:
1. Be wary of unsolicited emails or phone calls claiming to be from relevant government agencies. The IRS will not contact taxpayers via email, text message or social media.
2. Be wary of emails or messages asking you to click on a link or download an attachment, especially if they claim to be from the IRS. These could be phishing attempts to steal your personal information.
3. Protection of your personal information. Do not give your social security number, bank account number, or credit card number to anyone who reaches out to you, even if they claim to be from the IRS or other government agency.
4. Use secure websites for online transactions. Look for "https" in the website address, which indicates that the website is secure.
5. Use strong, unique passwords for your online accounts and enable two-factor authentication whenever possible.
6. Be wary of "free" tax preparation services or other services that sound too good to be true. These could be scams designed to steal your personal information or money.
7. Check your credit report regularly to make sure no one has opened an account in your name without your knowledge.
To avoid falling victim to these or other tax scams, be vigilant about protecting your personal information and stay informed about the latest scams. Remember, the IRS will never contact you by phone, email or social media asking for personal information or payment. If you receive a suspicious communication, report it to the IRS immediately.