Tax Season Safety: How to Avoid IRS Impersonation

Tax Day is April 15 and as the filing deadline approaches, IRS impersonation scams increase. Filing your taxes can be stressful enough, but worrying that you’ll be the victim of a tax scam can ramp up your anxiety. This tax season, it’s essential to understand what an IRS impersonation scam is and, to recognize the warning signs so you can avoid being taken in by one.

At Addition Financial, it’s our goal to simplify filing your taxes and give you the information you need to protect your personal information and your money. With that in mind, here’s our guide to how to avoid IRS impersonation scams this tax season.

What Are the Most Common Signs of an IRS Impersonation Scam?

The name says it all: IRS impersonation scams involve fraudsters posing as IRS agents to frighten taxpayers into surrendering sensitive information or money. People who provide their personal information to scammers usually end up being victims of identity theft. 

The good news is that there are a lot of red flags that are easy to recognize once you know what they are. Here are some of the most common signs of an IRS scam:

1. You receive communication in the form of a phone call, email, text message or social media message. There are some circumstances when the IRS might call you, but that only happens after initial contact via United States mail. They never initiate contact by phone.
2. You receive information you didn’t ask for claiming to be from the IRS. Examples might be a tax transcript or a new employer identification number.
3. You receive unsolicited contact (phone call, email, or direct mail) from a tax preparation service. Scammers who use this method may ask to confirm information from your online IRS account or claim your account has been compromised.
4. You get mail from the IRS in a year when you haven’t earned income and/or haven’t been required to file a tax return.
5. Someone claiming to be from the IRS demands immediate payment for taxes. The IRS always gives taxpayers the opportunity to dispute an amount owed and the bill will always come through the mail.
6. Someone asks you to use a gift card, a prepaid debit card or a wire transfer to make payment.
7. Someone asks you to update your information over the phone or by clicking an embedded link. The IRS will never call or contact you to ask you to update your information.
8. Someone, such as a tax professional, asks you to sign an incomplete tax return. You should only sign your return when it has been completed and you have verified that the information is correct.

The biggest red flag is any initial contact that doesn’t come through the post office. Emails, direct messages, texts and phone calls are not the IRS’ preferred method of communication. The one exception would be if you had an ongoing dialogue with the IRS about past due taxes. In that case, an agent might call you after the initial, mailed letter.

How Can I Tell if an Email or Phone Call is Really from the IRS?

Now that you understand that the IRS rarely makes phone calls, you might still be wondering:

What should I do if I get a suspicious call claiming to be from the IRS?

Our first tax tip on this topic is to stay calm. We understand that for a lot of people, any contact with the IRS can be stressful. Any scammer who contacts you pretending to be from the IRS is counting on your fear and stress to help them convince you to give them the information they want.

The best way to figure out if a phone call is a scam is to ask yourself if you’ve received an IRS notice through the mail. If the answer is no, the phone call is a scam. It’s that easy. The same is true of email. According to the IRS, they never initiate contact with a taxpayer using the phone or email. You might get an IRS phone call, but it will never be the first way they contact you.

What Should I Do if a Scammer Contacts Me?

The IRS has issued a consumer alert about what to do if you have been contacted by a scammer or victimized by a tax fraud. Here are the steps to follow:

Record Information about the Scam

The first step is to identify the phone number or email address the scammer used. We recommend writing it down to make sure that you have accurate information to provide to the Treasury Department.

Hang Up the Phone

After you’ve recorded the scammer’s phone number (if they call a cell phone, you can get the number from your call history), hang up the phone. You don’t need to feel shy about hanging up. Remember, this person is trying to steal your information.

Report the Email as a Phishing Scam

Most email providers have an option that allows users to report phishing scams. Doing so will remove the email from your inbox and help your provider protect you and other users from that scammer.

Report the Scam to the Treasury Department and the IRS

The final step to take is to report the attempted scam to the Treasury Department and the IRS. You have two options to notify the Treasury Department.

The first option is to call the Treasury Department at (800) 336-4484. As an alternative, you can visit the Treasury Department’s fraud reporting page. Click the IRS Scams and Fraud option and then choose your specific issue from the menu. You’ll be prompted to fill out a form to notify the Treasury Department.

If you received a phone call or email, you’ll also need to report it to the IRS. You can email them the information (the phone number, email address, and any other pertinent information) at phishing@irs.gov. 

What Steps Can I Take to Protect My Personal Information During Tax Season?

Now that we’ve covered how to recognize and report IRS scams, let’s review some of the practical steps you can take to protect your personal information during tax season and all year round.

Sign Up to Get an Identity Protection PIN (IP PIN)

In an effort to combat tax fraud and protect taxpayers, the IRS has set up a program to provide consumer protection for filing taxes. You can sign up for a six-digit IP PIN by visiting this page and clicking the blue button under the text.

If you’re a confirmed victim of tax fraud or identity theft, the IRS will assign you a new IP PIN each tax year. You’ll need both your Social Security Number and your IP PIN to access your information or file your taxes.

Remain Alert

One of the most important things you can do during tax season is to remain alert and act like a detective if you receive any communication claiming to be from the IRS. Remember that the IRS will never initiate contact with you over the phone, by email or text, or through social media.

The same is true of tax professionals. No reputable tax professional will call you out of the blue or send an email solicitation. Even if you’re working with a tax professional, be suspicious if they ask you to sign an incomplete tax return.

Put a Credit Freeze on Your Credit Report

If you’ve been a victim of identity theft and provided sensitive information such as your SSN or bank account number to a scammer, call one of the three major credit reporting bureaus (Equifax, Experian or TransUnion) and put a freeze on your credit. You only need to contact one of the three because all are required to notify the others.

The freeze will prevent anybody from using your SSN to obtain a credit card or loan. You’ll be given a PIN that you can use to unfreeze or thaw your credit.

Use Two-Factor Authentication with Your Financial Institution

Two-factor authentication, also known as 2FA, is a security measure to protect you if someone tries to access your bank account. You already have a password to log into your account online or through your banking app. 2FA is another layer of protection.

2FA protection requires you to create a PIN, get an automated text message with a six-digit code, or use a biometric scan such as a fingerprint to access your account. In other words, even if a scammer had your account information, they wouldn’t be able to access it without passing through a secondary security layer.

Protect Yourself This Tax Season

This tax season, we want you to stay alert and protect yourself in any way you can. Our tips for filing taxes include advice about how to recognize the red flags that point to a tax scam, learn how to report fraud and attempted fraud and protect yourself every day with common-sense security measures.

Are you looking for a financial institution with state-of-the-art security measures and tons of financial resources for you to use? We would love to have you join the Addition Financial family! Click here to learn about the benefits of membership and join today.