$488 Million Stolen in IRS Scams
That’s right, almost ½ a Billion, with a very large capital B, was stolen from individuals in 2018 using IRS type scams, according to a report released by The Federal Trade Commission in February 2019. The report also indicated that nearly 1 in 5 of us were victims and ~1/2 were young adults, age 20 to 29. This last statistic surprised me as I always assumed it was the elderly among us that were being targeted the most with IRS scams.
As our world continues to become more interconnected and the “internet of things” becomes more and more of a reality thieves are adapting and finding new and creative ways to try and take what is yours. This is by no means a comprehensive list but some of the ways that money is stolen using IRS type scams are:
· Scams related to natural disasters (this one is super awesome, you’ve been devastated by a natural disaster and along comes a thief to take more…)
· IRS impersonation email scams (the IRS does not send unsolicited emails, this is an easy one, delete anything that says IRS unless you are currently in communication with them)
· Phone scam using Taxpayer Advocate Service numbers (Hi I’m Johnny and we’ve recently been contacted about an IRS debt you owe. I’m from the TAS and we’re here to help, please provide confirmation of your ssn, phone number, account numbers, first born, etc….go to hell Johnny)
· “Ghost” tax return preparers (they won’t sign the return they prepared, they want you to sign and mail, double check the account number where your direct deposit is headed as they often use their own and steal your refund, they want to be paid in cash only)
· “Tax Transcript” email scam (again the IRS does not do email, maybe in the 22nd century….)
· IRS-Impersonation telephone scams (YOU OWE US MONEY AND IF YOU DON’T PAY WE’RE GOING TO REVOKE YOUR SSN, IMMIGRATION STATUS, BIRTHRIGHT, MIDDLE NAME, ADDRESS AND ANY DEGREES YOU EVER EARNED!!!!.....I used to keep a police whistle next to the phone that hung on the wall, yep I’m old enough to remember that, for those guys….so satisfying)
The IRS provides much more detail about each of these types of scams on their website at https://www.irs.gov/newsroom/tax-scams-consumer-alerts but it is much to lengthy for this article.
One of the more recent ways that thieves steal money from the unsuspecting is to have potential victims pay an “unpaid” tax bill with gift cards. I know some of you, myself included, are thinking that there is no way I would fall for sending someone a gift card to pay for a tax bill. Before we both point the mental finger at others read through the following common scenario.
Someone posing as an IRS agent calls the taxpayer and informs them their identity has been stolen.
The fake agent says the taxpayer’s identity was used to open fake bank accounts.
The caller tells the taxpayer to buy gift cards from various stores and await further instructions.
The scammer then contacts the taxpayer again telling them to provide the gift cards’ access numbers.
Again, I read through this and I tell myself there is no way I would fall for something like this and maybe I wouldn’t but maybe someone close to me would. Someone who is a little less savvy with the internet or old school enough to respond anytime they hear “government agency”. Even if the above scenario does not seem like something you would fall for make sure you are educating those close to you who may be more susceptible. Age can play a significant factor in this particular scam. My girlfriend’s grandma was shocked and startled when I showed her a picture of her sister’s grave after a five minute google search. Her sister died in the 1940’s and she did not know where her sister was buried. To a lot of us it is not a big deal to do a google search and find a lost relative but to many others that are not as tech savvy it is wonderful, scary and intimidating. All of those emotions come in to play when we receive a phone call from the “IRS”. Look out for those close to you, they spent a lifetime looking out for you.
In the scenario mentioned above there are multiple red flags that the caller is not from the IRS. The IRS does not:
Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer.
Generally, the IRS will first mail a bill to any taxpayer who owes taxes.
Demand that taxpayers pay taxes without the opportunity to question or appeal the amount they owe. All taxpayers should be aware of their rights.
Threaten to bring in local police, immigration officers or other law-enforcement to have the taxpayer arrested for not paying.
Revoke the taxpayer’s driver’s license, business licenses, or immigration status.
There are multiple ways to report these thieves to the IRS if they make you as angry as they do me. Stealing money from those who have worked hard for it is a crime that leaves a horrible taste in the back of my throat. Especially when those people are often elderly, on limited income, have limited contact with the outside world and are trying to be good citizens by responding to what they believe to be a legitimate government request. If you believe you’ve been targeted by a scammer some of the reporting options are:
Contact the Treasury Inspector General for Tax Administration to report a phone scam. Use their IRS Impersonation Scam Reporting web page. You can also call 800-366-4484.
Report phone scams to the Federal Trade Commission. Use the FTC Complaint Assistant on FTC.gov. They should add "IRS Telephone Scam" in the notes.
Report an unsolicited email claiming to be from the IRS, or an IRS-related component like the Electronic Federal Tax Payment System, to the IRS at phishing@irs.gov. The sender can add “IRS Phone Scam” to the subject line.
If you receive ANY contact from the IRS and are unsure if it is real please, please reach out to me or to a tax expert, not your crazy uncle (I may be a crazy uncle but I don’t give tax advice to my eight year old nephew, yet….). I do not charge any fee to take a quick look at the correspondence and tell you whether or not it is a legitimate inquiry from the IRS. Please do not forward me emails, remember the IRS does not send emails in initial contact, just delete them as that is all I will do.
I hope this helps some of you keep your hard earned money. Don’t let what you’ve worked so hard for slip between your fingers because you’re scared, lazy, confused or angry when contacted by the “IRS”. Let me help, it’s what I do. If it is a real contact from the IRS, I can help with that as well. Be safe out there and look out for each other.