While many of us were focusing on the holiday last week, it was also National Tax Security Awareness Week. Before we know it, tax season will be upon us. The Better Business Bureau has some suggestions for consumers and business owners for keeping their tax information secure and avoiding tax-related scams.
In 2017, BBB processed approximately 2,400 complaints against tax return preparation services and related businesses (including accountants preparing tax returns). For those complaints, the average amount for which consumers sought BBB’s help was $500.
Tax-related scams are even more prevalent. In 2017, BBB received approximately 3,500 reports to BBB Scam Tracker from consumers regarding con artists claiming to be with the IRS. Scammers use the regular mail, telephone or email to set up individuals, businesses, payroll and tax professionals.
The IRS doesn’t initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information. Recognize the telltale signs of a scam. One of the scams many of us have experienced is the phone scams. The Federal Trade Commission spends endless hours warning consumers of sophisticated scams targeting taxpayers, including recent immigrants. Callers claim to be IRS employees, using fake names and bogus IRS identification badge numbers. They may know a lot about their targets, and they usually alter the caller ID to make it look like the IRS is calling.
Victims are told they owe money to the IRS and it must be paid promptly through a gift card or wire transfer. Victims may be threatened with arrest, deportation or suspension of a business or driver’s license. In many cases, the caller becomes hostile and insulting. Victims may be told they have a refund due to try to trick them into sharing private information. If the phone isn’t answered, the scammers often leave an “urgent” callback request.
BBB has been cooperating with the IRS by providing the agency with phone numbers reported from consumers to BBB Scam Tracker. Any law enforcement agency can request additional information from Scam Tracker and we are always willing to work with them to help stop this fraud.
Here are some ways consumers and business owners can combat tax fraud:
- Deal only with trustworthy tax preparation services. Check BBB.org for the latest Business Profile before you engage a company for the first time.
- Protect personally identifiable information (PII) such as birth date, Social Security numbers, bank accounts, etc.
- Check out websites carefully and make sure you are accessing the real IRS website (irs.gov) when filing your taxes electronically or inquiring for additional information.
For more information on tax security and tax scams go to bbb.org/taxscams.