The first day to file your 2017 taxes is less than a week away!  While everyone is rushing around and trying to get all of their filing information in order, criminals are lurking and waiting to pounce.  If you’ve tuned in to our blog for any length of time, you know that we’ve talked about tax-related identity theft before.  This is the time of year when criminals go into overdrive.

Filing Fraudulent W2s

As previously mentioned, one of the best ways to avoid falling prey to tax-related identity theft is by tax receiptfiling your return sooner rather than later.  Why?  Because the IRS will only process one return with your unique social security number.  If you file your return early and later a criminal tries to file a fraudulent return in your name, the IRS is going to know something fishy is going on.  They’re not going to process the fraudulent return because a return associated with your social security number was already processed.

What if you go to file your 2017 return and find out that another return has already been processed under your name and social security number?  You’re going to want to act fast.  Not only was your tax return compromised, all of your personal information is at risk since the perpetrator now has your social security number. Here’s what you should do:

  • File a Form 14039 – Identity Theft Affidavit
  • Call one of the major credit reporting agencies (Experian, TransUnion, or Equifax) to place a “fraud alert” on your account
  • File a complaint with the Federal Trade Commission (FTC)
  • Contact your financial institution and alert them of fraudulent financial activity

Phishing Scam

phoneWhile having a fraudulent tax return filed under your name can be devastating, unfortunately, it’s not the only tax-related scam out there.   Another scam that’s running rampant recently is called a “phishing” scam. In this type of scam, the victim is contacted (usually by phone or email) by a person claiming to be affiliated with the IRS. The scammer tells the victim that money is owed to the IRS and that payment must be made promptly to avoid legal action. Recent immigrants are often targeted as victims and are threatened with deportation or arrest if payment is not made promptly in the form of pre-paid debit cards, gift cards, wire transfers, etc.

How can you protect yourself? First of all, know how the IRS operates! They will NEVER:

  • Call you to demand immediate payment. If you owe them money, they will have sent you a bill in the mail.
  • Demand immediate payment in a certain way (gift cards, prepaid debit cards, etc.).
  • Ask for credit or debit card information over the phone.
  • Threaten you with arrest for noncompliance.

What if you received one of these unsolicited emails and clicked on a link that was enclosed? Or, maybe you received a phone call that you feel like was from a scammer. Worse yet, maybe you gave the scammer some personal information. What should you do?

  • Don’t open any of the attachments! Forward the email you received as-is to phishing@irs.gov
  • Gather information from the caller – name, badge number, callback number, caller ID, etc. Call 1-800-366-4484 to find out whether the person who contacted you is an IRS employee. If they are, go ahead and call them back. If they aren’t, report the incident to the Treasury Inspector General for Tax Administration (TIGTA) and phishing@irs.gov  with the subject line “phone scam”.
  • If the scam was in the form of a text, forward the text as-is to the IRS at 202-552-1226

Scams Gathering W2 Information from Payroll and HR Departments

Scammers have gotten quite sophisticated. They’ve gone beyond targeting individuals one at a time. Scammers have graduated to scamming entire departments to gather more information on more victims in one fell swoop. Here’s how it happens. Scammers devise an authentic-looking email from a professional of an organization. They email the payroll or HR department and request a list of all employees and their W2 forms.

Why is this so dangerous? By receiving not just one but GROUPS of W2s, these scammers are gathering droves of information that will allow them to commit fraud. From filing fraudulent tax returns to using social security number to apply for fraudulent credit cards and loans, these scammers are able to wreak havoc on victims’ lives.

How can you protect your organization? Well, here are a few steps to take:

  • Limit the number of people with access to personal information such as W2s. Make sure that those employees are trained extensively and are fully aware of all of the phishing scams out there.
  • If personal information has been compromised, immediately email the IRS at dataloss@irs.gov with a subject line of “W2 Data Loss” and include the volume of employees impacted. Do NOT attach any personal information for ANY employees.
  • Forward the email as-is to phishing@irs.gov with the subject line “W2 Data Loss”
  • Email statealert@taxadmin.org to learn how to report the victim information to each state.
  • File a complaint with the FBI for the scam at IC3.gov. You may also need to file reports with your local law enforcement.
  • Alert your employees so that they can take proper measures to protect themselves from identity theft.

The scams mentioned above are just a few ways that scammers are trying to harvest your personal information. Unfortunately, in such a digital age, scammers seem to be a dime a dozen. Every time we think we’ve found a way around one of the scams, a new scam arises. Be informed of the types of scams out there and be skeptical of anything that seems fishy. Trust your gut – if something seems off, it probably is!

Tax season is here and the countdown to the first day to file is in the single digits! Our friendly team of tax professionals would love to answer any questions you may have. Appointments are booking quickly! Call our office today to schedule your free consultation!

 
“IRS Urges Public to Stay Alert for Scam Phone Calls.” IRS, 27 Aug. 2017, www.irs.gov/newsroom/irs-urges-public-to-stay-alert-for-scam-phone-calls.
“Report Phishing and Online Scams.” IRS, 28 Nov. 2017, www.irs.gov/privacy-disclosure/report-phishing.
“Tax Scams/Consumer Alerts.” IRS, 17 Jan. 2018, www.irs.gov/newsroom/tax-scams-consumer-alerts.