Know the Facts: Common Tax Scams

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Your phone rings.

You look at the screen. It has a number you don’t recognize, but the caller ID appears as “IRS.” Your heart leaps into your throat. What could be wrong? You answer. Leer en español.

TaxScams2015The person on the phone tells you they’re with the IRS, they may even give a badge number. They begin to tell you that you owe back taxes. They may even say, “you need to pay immediately” or “The police will arrest you for not paying.”

It’s scary, and understandably confusing. But above all else it is a scam.

According to the IRS, they will never:

  • Call to demand immediate payment, nor will the agency call about taxes owed without first having mailed you a bill
  • Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe
  • Require you to use a specific payment method for your taxes, such as a prepaid debit card
  • Ask for credit or debit card numbers over the phone
  • Threaten to bring in local police or other law-enforcement groups to have you arrested for not paying.

There are similar scams targeted at email. These are called “phishing” schemes. You may get an email that appears to be from the IRS that asks you to “update your IRS e-file.” It may mention USA.gov and IRSgov. These emails are not from the IRS. They link to websites that look like the IRS site but are solely designed to capture your personal information for scammers to use illegally. The IRS will not initiate contact with you by email to request personal or financial information.

Forward any email you believe to be a scam to phishing@irs.gov.

Dirty Dozen

These are two of the most prevalent scams reported by the IRS, but every year the agency also releases a list of the top 12 or “dirty dozen” tax scams. These include false promises of free money from inflated refunds and impersonation of charitable organizations. You can see them all here.

We also have some guidance on how to protect yourself from becoming the victim of a tax scam.

Click here to read more Tax Preparation hints from H&R Block!

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