Tips on Recognizing Tax Scams

Submitted by Jon Freeman

Every year people fall victim to different types of tax scams. These scams can be via a phone call, or some other format. Here are some things the Internal Revenue Service (IRS) thinks taxpayers should remember to help them spot scams and avoid becoming a victim:

Tax Phone scams:
1. The IRS does not leave pre-recorded, urgent or threatening messages.
2. In many versions of phone scams, potential victims are told if they do not call back, a warrant will be issued for their arrest. Other verbal threats include law-enforcement agency intervention, deportation and revocation of licenses.
3. Criminals can fake or “spoof” caller ID numbers to appear to be anywhere in the country. Scammers can even spoof an IRS office phone number, or the numbers of various local, state, federal or tribal government agencies.

The IRS will never do the following:
1. Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. The IRS does not use these methods for tax payments.
2. Ask for checks to third parties. The IRS has specific instructions on how to pay taxes. All tax payments should only be made payable to the U.S. Treasury.
3. Threaten to immediately bring in local police or other law-enforcement groups to have the taxpayer arrested for not paying.
4. Demand that taxes be paid without giving the taxpayer the opportunity to question or appeal the amount owed.

To learn more about spotting these types of scams visit the IRS tax scams web page. For more information on managing your money feel free to visit the GCPL Personal Finance Guide.