It’s time to get those W-2 and 1099 tax forms ready. On January 27th, the IRS began accepting paper and electronic tax returns ahead of the April 15th due date. But as users prepare to file, scammers prepare to take advantage of innocent taxpayers with malicious tactics, looking to harvest the extensive amounts of personal data found in IRS tax documents. Let’s take a look at common tactics hackers may leverage this tax season.
A commonly used tactic involves hackers posing as collectors from the IRS, as tax preparers, or government bureaus. This tactic is pretty effective due to Americans’ concerns of misfiling their taxes or accidentally running into trouble with the IRS. Scammers take advantage of this fear, manipulating innocent users into providing sensitive information or money over the phone or by email. And in extreme cases, hackers may be able to infect computers with malware via malicious links or attachments sent through IRS email scams.
Another tactic used to take advantage of taxpayers is the canceled social security number scam. Hackers use robocalls claiming that law enforcement will suspend or cancel the victim’s Social Security number in response to taxes owed. Often, victims are scared into calling the fraudulent numbers back and persuaded into transferring assets to accounts that the scammer controls. Users need to remember that the IRS will only contact taxpayers through snail-mail or in-person, not over the phone.
Another scam criminals use involves emails impersonating the IRS. Victims receive a phishing email claiming to be from the IRS, reminding them to file their taxes or offering them information about their tax refund via malicious links. If a victim clicks on the link, they will be redirected to a spoofed site that collects the victim’s personal data, facilitating identity theft. What’s more, a victim’s computer can become infected with malware if they click on a link with malicious code, allowing fraudsters to steal more data.
Scammers also take advantage of the fact that many users seek out the help of a tax preparer or CPA during this time. These criminals will often pose as professionals, accepting money to complete a user’s taxes but won’t sign the return. This makes it look like the user completed the return themselves. However, these ghost tax preparers often lie on the return to make the user qualify for credits they haven’t earned or apply changes that will get them in trouble with. Since the scammers don’t sign, the victim will then be responsible for any errors. This could lead to the user having to repay money owed, or potentially lead to an audit.
While these types of scams can occur at any time of the year, they are especially prevalent leading up to the April tax filing due date. Consumers need to be on their toes during tax season to protect their personal information and keep their finances secure. To avoid being spoofed by scammers and identity thieves, follow these tips:
- File before a scammer does it for you. The easiest defense you can take against tax season schemes is to get your hands on your W-2 and file as soon as possible. The more prompt you are to file, the less likely your data will be raked in by a fraudster.
- Obtain a copy of your credit report. You’re entitled to a free copy of your credit report from each of the major bureaus once a year. So, make it a habit to request a copy of your file every few months and check for any suspicious activity.
- Beware of phishing attempts. Phishing is a common tactic crooks leverage during tax season, so stay vigilant around your inbox. This means if any unfamiliar or remotely suspicious emails come through requesting tax data, double-check their legitimacy. Be wary of strange file attachment names such as “virus-for-you.doc.” Remember: the IRS only contacts people by snail mail, so if you get an email from someone claiming to be from the IRS, stay away.
- Watch out for spoofed websites. Scammers have extremely sophisticated tools that help disguise phony web addresses for DIY tax software, such as stolen company logos and site designs. To avoid falling for this, go directly to the source. Type the address of a website directly into the address bar of your browser instead of following a link from an email or internet search. If you receive any suspicious links in your email, investigating the domain is usually a good way to tell if the source is legitimate or not.
- Consider an identity theft protection solution. If your data does become compromised, be sure to use an identity theft solution such as McAfee Identity Theft Protection, which allows users to take a proactive approach to protect their identities with personal and financial monitoring and recovery tools to help keep their identities personal and secured.
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