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5 Tax Scam Facts You Need To Be Aware Of

The popular sci-fi TV series Lost in Space show aired between 1965 and 1968 and followed the adventures of a pioneering family of space colonists who struggled to survive in an often hostile universe after their ship was sabotaged and thrown off course.

The popular catchphrase “Danger, Will Robinson!” is the most memorable slogan used by family’s robot to warn young Will Robinson about an impending threat.

The Federal Trade Commission reported in 2013 that an estimated 25.6 million people had paid their hard-earned money for fraudulent products and services in 2011. In 2016, the IRS saw an approximate 400 PERCENT SURGE in email phishing and malware incidents, and the FTC reported that imposter scams INCREASED this year by 47 percent, in large part due to a massive tax scam that still continues to be a serious threat today.

“We recognize that unlawful debt collection practices continue to cause significant harm to many consumers,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection.

While we do not offer tax advice, we do consider it our mission to help educate consumers so they can keep as much of their hard-earned money as possible. The last thing anyone wants is to get scammed. We’ve put together this consumer alert so you can stay in the know.

5 Tax Scam Facts You Need To Be Aware Of

FACT #1: The IRS will never call taxpayers via telephone to demand an immediate payment. In the latest tax scam, criminals are able to alter the caller ID so it appears as though the criminal is in fact from the IRS. They will give you their employee ID number, gladly connect you to a manager, and they may even have personal information about you. You need to know that if you are a taxpayer who has an outstanding tax obligation, the REAL IRS will mail you a bill.

What to do: Record the employee’s name and badge number, tell them you will call them back, and hang up. Call 1-800-366-4484 to determine if the caller is, in fact, an IRS employee. If they are not, report the incident to the Treasury Inspector General for Tax Administration and to the IRS at [email protected] (Subject: ‘IRS Phone Scam’). DO NOT respond to these calls to pay your taxes.

FACT #2: If you are a U.S. citizen born and raised, then chances are you DO NOT need to file form W-8BEN. Fake W-8BEN forms are being used in the tax scam to collect private information. The real version of these forms does have a legitimate purpose – they collect taxes for non-U.S. persons and foreign corporations. Massive numbers of these fake dorms are being sent out via email, text, or regular mail – probably because most people have never heard of such a form – and they ask you to complete the information so that you can “claim an exemption or withholding on income including interest that is owed you.” These forms are fake. A legitimate W-8BEN form DOES NOT ask for your PIN numbers and passcodes, a passport number, or your mother’s maiden name.

What to do: Do not reply. Do not open any attachments – they may contain malicious code that will infect your computer. Do not click on any links. You can forward the email as-is to the IRS at [email protected]. If you or someone you know does click on the link, visit the IRS identity protection page. If you receive a letter in the mail and are unsure whether or not it’s real, go to the IRS home page and search the letter number or form number or call 1-800-829-1040.

FACT #3: The IRS DOES NOT initiate contact by sending emails or text messages, nor do they use social media channels to request personal or financial information. This is called phishing, and it is one way that criminals capture personal information about your bank or financial institutions. For example, they might send you an email asking you to “update your IRS e-file.”

What to do: report all unsolicited email claiming to be from the IRS to [email protected]. If you’ve experienced any monetary losses due to an IRS-related incident, please report it to the Treasury Inspector General Administration (TIGTA) and file a complaint with the Federal Trade Commission (FTC) through their Complaint Assistant to make the information available to investigators.

FACT #4: The IRS will never threaten to arrest you, nor will they send a police officer or any other law-enforcement group to come and get payment from you. Never respond to anyone claiming to be the IRS who request immediate payment for back-taxes owed using a weird payment method such as a prepaid debit card, iTunes card, gift cards, or wire transfer.

What to do: remember that scammers change tactics and they can be very aggressive. While it might seem ludicrous that anyone would use an iTunes gift card to pay their tax bill, variations of this can continue to evolve. Fake websites, letter heads, and email disguises are being used. To be prepared for what’s next, you need to know the facts.

FACT #5: The IRS will never ask for a credit card or debit card number over the phone. Generally speaking, it’s never a good idea to give out any personal information over the phone unless YOU were the one to call first.

One of the biggest ways these scams lure people in is by offering deals that sound too good to be true. Any financial professional worth their salt should take the time to get to know your situation first before they tell you when a product or strategy is a good idea, and when it is not.

We at annuity gator have no affiliation with the IRS, nor do we give tax advice, but if you have a question about a financial product, an annuity, or a life insurance offer that seems too good to be true, and you want to know what’s what, then contact us today or give us a call at (888) 440-2468. We’re always happy to help someone improve their financial standing.

 

5 Tax Scam Facts You Need To Be Aware Of

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