Beware: Income Tax Scams Have Gotten More Sophisticated

Aug 15, 2019 | Tax Resolution

Last year, the U.S. Department of Justice announced that they had successfully taken legal action against a large-scale multinational telephone fraud operation where the perpetrators posed as IRS agents or immigration officials to scam victims. The 15,000 victims of the fraud, which was perpetrated over a four-year period, lost hundreds of millions of dollars and more than 50,000 individuals had their personal information misused.1

There are several things to know about what the IRS does and does NOT do in order to not fall victim to scammers.

These and other scams where fraudsters impersonate government agencies are almost commonplace, however, the IRS warms taxpayers that these scammers are using increasingly more sophisticated tactics.

They ask for account information

Many people in the U.S. have gotten telephone calls from someone claiming to be an IRS agent. The caller often says that the recipient owes money and demands payment immediately through a bank account, credit card, gift card or debit card. The scammer can also claim that they are from the IRS and that the IRS owes the taxpayer a refund.2 In this case, the scammer asks for bank account or credit card information so they can deposit the funds in the taxpayer’s account. Sometimes the taxpayer is contacted by email, using the same tactics.

Fraudulent qualifications

The latest and most sophisticated twist on the phone call scam is for the call to appear on caller identification systems as if it is coming from an IRS Taxpayer Assistance Center (TAC). When the caller questions the scammer about their legitimacy, the scammer tells the caller to go online to IRS.gov and look up the phone number of their local TAC.3 The number on the caller ID will match what is posted on the IRS website because the scammer has programmed their system to display the TAC number.

They make threats

Recently two variations on the phone scam have surfaced. The first has the scammer claiming that the taxpayer’s social security number will be suspended for overdue income taxes.4 In the second variation the scammer claims that the taxpayer owes delinquent taxes to the Bureau of Tax Enforcement and a lien or levy is being placed on their assets. There is no such agency as the Bureau of Tax Enforcement.5 Often this lien/levy is mailed to the taxpayer.

To keep from being victimized by these types of scams it is important to know that IRS employees will not call a taxpayer if they owe tax without first sending a bill in the mail.6 IRS agents will never demand immediate payment. In fact, there is a formal process for taxpayers to question or appeal tax bills that they believe are not owed.

An indication that the caller is fraudulent is when they ask for social security numbers or bank account numbers or demand you pay by credit card, checking account, wire transfer or gift and debit cards. IRS agents will also not threaten to contact local police, immigration authorities, or other agencies to arrest the taxpayer for non-payment of taxes. IRS agents can’t take away your driver’s license, business license or immigration status. Finally, IRS agents will not threaten legal action, such as a lawsuit. These are all tactics that the scammers use to intimidate taxpayers into falling victim to their schemes.

What to do

If you receive a phone call or email from someone you suspect is not the IRS do not give out any information. If you think you may owe taxes, call the IRS at 800-829-1040. If you do not owe any taxes the IRS recommends that you report the caller by accessing the IRS Impersonation Scam Reporting web page at www.tigta.gov or call the Treasury Inspector General for Tax Administration (TIGTA) at 800-366-4484. They also recommend that you file a complaint with the Federal Trade Commission at www.FTC.gov.

If you think you have been a victim of an Income Tax Scam, call our Tax Resolution Law Firm today. We have been helping people achieve peace of mind and resolve their tax disputes for over 20 years. As a full- service tax dispute law firm, we have been protecting hard-working individuals from IRS bank levies, garnishments, liens, and more. Call us for a case evaluation today!

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1 U.S. Breaks Up Vast I.R.S. Phone Scam, www.newyorktimes.com, by Christine Hauser, 7/23/2018
Link: https://www.nytimes.com/2018/07/23/business/irs-phone-scams-jeff-sessions.html

2,6 Don’t Fall for Scam Calls and Emails Posing as IRS, IRS Tax Tip 2019-10, 2/7/2017
Link: https://www.irs.gov/newsroom/dont-fall-for-scam-calls-and-emails-posing-as-irs

3 IRS, Security Summit Partners Warn of New Twist on Phone Scam, IRS-2018-103, 4/24/2018, www.irs.gov
Link: https://www.irs.gov/newsroom/irs-security-summit-partners-warn-of-new-twist-on-phone-scam-crooks-direct-taxpayers-to-irsgov-to-verify-calls

4,5 IRS Reminder: Tax Scams Continue Year-Round, IRS-2019-104, 6/5/2019, www.irs.gov
Link: https://www.irs.gov/newsroom/irs-reminder-tax-scams-continue-year-round

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