During the tax season, tax scammers have the opportunity to file fraudulent tax returns on taxpayers’ behalf to receive huge refunds. They file thousands of false tax returns using the stolen Social Security Number, name, and other tax details of taxpayers. Their success rate is high. This is the time when taxpayers are the most vulnerable to tax scammers.

Tax Fraud: Identity Theft

Stealing the tax, personal and/or financial information of taxpayers is conducted through various means, including telephone calls, emails, text messages, letters, and even social networking sites. Many times, the theft is conducted using a façade. Scammers will use the name of a reputed and well-known institution such as the IRS to extract sensitive information from taxpayers. Scammers are also known to appear in person at the taxpayers’ doorstep pretending to be from the IRS, and sometimes even the police.

Scammers may attempt to intimidate a taxpayer into sharing sensitive information or may tempt taxpayers’ into committing a tax crime for monetary benefits. When faced with a situation that requires immediate action, take the time to think before acting.

Avoiding Tax Fraud

To avoid falling into a trap laid by tax scammers, taxpayers must ensure that they do not share their tax, financial and personal information with any unverified source. The IRS never initiates contact with taxpayers through email. If you receive an email from the IRS prompting you to either click on the links in the email or to open attachments, it is a phishing attempt that must be reported to the IRS. You may forward the email to phishing@irs.org without clicking on the links or opening attachments.

The most effective method to tackle attempts of identity thieves is to ask questions and take time to respond. Tax thieves want you to act fast, without thinking. If you make inquiries, you will know whether you can trust them or not. Ask about the location of their office, and the identity of the person speaking to you. Check the information you have online. Take your time to judge. We tend to make mistakes when we are in a hurry.

Tax Fraud & the Tax Season

The tax season sees millions of attempts at identity theft. Identify theft again topped the IRS dirty dozen tax scams list in 2013. To protect yourself from identity theft, keep your tax information safe from the attempts from tax scammers. It is advisable to file your return early in the tax season. It will ensure that any fraudulent returns filed by tax thieves will be rejected by the IRS.