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As the April 15 federal tax deadline approaches, most taxpayers have less than two weeks left to file their 2023 personal tax returns or request an extension, but scammers have a lot of time to spare when it comes to filers. There’s still plenty of time to try to steal personal and financial information.
Last year, the IRS received 294,138 complaints of identity theft, the second-highest number in the agency’s history.The agency’s criminal investigators identified Tax fraud of over $5.5 billion.
As of the March 22 report, the IRS had processed 79.2 million federal returns, according to IRS spokesman Eric Smith. That’s nearly half of the 167 million individual tax returns expected to be filed this season.
Fraud experts say taxpayers who have not yet filed or paid taxes should take precautions.
“To mail your tax return or pay your taxes, you can either file electronically or go to the post office in person,” said Jennifer Hessing, director of fraud analysis at Wells Fargo. “External mailboxes can be targeted for theft as fraudsters seek to steal personal information and checks sent out for tax payments.”
Here are three common tax scams and how to avoid them.
Be wary of unsolicited emails, texts, and phone calls
If you receive an email, text message, or phone call from someone or company you don’t know offering to assess your potential tax savings or offer you a larger refund, be wary.
The proposal would look like this: “We want to win it. [refund] We will get it to you as easily and quickly as possible. “All you have to do is give us your information and we’ll make it happen,” said Steve Earls, Director of Consumer Data Security at IDShield. . Is there a phone number I can call? There are also fake call centers. It’s all the same kind of conglomerate. ”
You may also receive phone calls, emails, or text messages from scammers posing as legitimate tax agencies or financial institutions requesting valuable personal or financial information, which could lead to identity theft.
A third party offers to set up an IRS account
Fraudsters can then sell that information or use it themselves to file fraudulent tax returns, open credit card accounts, or obtain loans.
“Ghost Tax Preparer”
A “ghost taxpayer” may prepare your return for you. If you do not sign a document or provide your address or tax identification number. They may have already collected your personal and financial information, assuming you sign the return without verifying this information.
One of the easiest ways to spot fraud is when a taxpayer hires a return preparer and the return is missing information in the Paid Preparer section or is listed as “self-prepared.” said Los Angeles-based certified public accountant Miklos Ringbauer.
“If a client is considering responding to reviews, this should be the first and biggest red flag,” he said. “Taxpayers should never file a return, just sign it without reviewing it.”
Tips to avoid tax fraud
- The IRS will typically contact you by regular mail rather than by phone. the agency says “We will never contact taxpayers via email, text message, or social media regarding invoices or tax refunds.”
- Use only approved verification processes available on IRS.gov.
Report tax fraud
If you believe you are a victim of tax fraud, report it to government authorities immediately.
- The IRS recommends that you report all unsolicited email that claims to be from the IRS or an IRS-affiliated entity to phishing@irs.gov.
- If you’ve been the victim of identity theft, the Federal Trade Commission offers a step-by-step guide on what to do. Identify theft.
CNBC’s Stephanie Dhue contributed reporting.
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