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Be Aware of these Tax Scams

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Be Aware of these Tax Scams

Pandemic-related Scams

Economic Impact Payment and tax refund scams. Identity thieves who try to use Economic Impact Payments (EIPs), also known as stimulus payments, are a continuing threat to individuals. The IRS has issued all Economic Impact Payments, and most eligible people have already received their stimulus payments.

Unemployment fraud leading to inaccurate taxpayer 1099-Gs. Many taxpayers lost their jobs and received unemployment compensation from their state during the pandemic. Scammers took advantage of this by filing fraudulent claims for unemployment compensation using the stolen personal information of individuals who had not filed claims. Taxpayers should also be on the lookout for a Form 1099-G reporting unemployment compensation they didn't receive.

Fake employment offers posted on social media. There have been many reports of fake job postings on social media. These fake posts entice their victims to provide their personal financial information that can be used to file a fraudulent tax return for a fraudulent refund or used in some other criminal endeavor.

Fake charities that steal your money. Bogus charities are always a problem. To check the status of a charity, use the IRS Tax Exempt Organization Search tool. Individuals should never let any caller pressure them. A legitimate charity will be happy to get a donation at any time, so there's no rush, and donors are encouraged to take the time to do the research.

Spear Phishing

Spear phishing is an email scam that attempts to steal a tax professional's software preparation credentials. These thieves try to steal client data and tax preparers' identities to file fraudulent tax returns for refunds. Spear phishing can be tailored to attack any type of business or organization. It is a serious problem because it can be tailored to attack and steal the computer system credentials of any small business with a client database, such as tax professionals' firms. The latest phishing email uses the IRS logo and a variety of subject lines such as "Action Required: Your account has now been put on hold." These emails are scams that send users to a website that shows the logos of several popular tax software preparation providers. Clicking on one of these logos will prompt a request for tax preparer account credentials.