Don’t Get Caught in a Tax Return Scam

During tax season, many people are at risk of being scammed by scammers who try to steal their refunds. Here’s what to know about tax return scams and how to avoid them.

How the Tax Return Scams Play Out

In a tax return scam, a fraudster steals a taxpayer’s personal information and files a fake tax return on their behalf. The scammer directs the refund into the taxpayer’s checking account.

After it’s deposited, the scammer calls the victim, impersonating the IRS and claiming the refund was mistakenly inflated. They’ll instruct the victim to return the alleged extra funds via gift card or wire transfer. Of course, this money goes directly to the scammer.

In another version, a scammer steals someone’s information. They then use this information to file a fake tax return in the victim’s name. Finally, they redirect the tax refund to their own account.

Protect Yourself

Here’s how to keep your money and your information safe during tax season:

• File early.
• E-file using a secure computer.
• Keep tax returns in a secure location.
• Never download links or attachments from unverified sources.
• Never share personal information with an unknown contact over the phone or online.

Knowing the following can also alert you to possible scams:

• If a taxpayer does not file, the refund checks will never deposit into their account. If you receive a refund in your bank account before filing your taxes, it’s probably a tax return scam.
• The IRS never demands payment by a specific method. If you’re asked to wire money or pay by gift card, you’re talking to a scammer.

If a Scammer Has Targeted You

If you get a phone call or letter from someone claiming to be the IRS and stating that you owe tax money, verify it by calling 1-800-829-1040. Emails allegedly sent by the IRS are scams (because they simply don’t do that).

If you haven’t received your tax refund within one month of filing, check your refund’s status on the IRS webpage. If the site shows that your refund was issued, but you haven’t received it, you may be the victim of a tax return scam and identity theft. Alert the IRS at 1-800-908-4490.

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This article is for educational purposes only. WeStreet Credit Union makes no representations as to the accuracy, completeness, or specific suitability of any information presented. Information provided should not be relied on or interpreted as legal, tax or financial advice. Nor does the information directly relate to our products and/or services terms and conditions.