Tax Season: Be Mindful of These Scams


With the tax season just behind us, the IRS indulges in one interesting social experiment, where they share some of the worst and most successful scams that people fall for. Scams are run throughout the year, but they increase in intensity around the tax season.

If you want to be sure that you don’t fall for these scams, you should do your taxes with a tax attorney. They are typically well versed in everything you need to file and if you are selected for an audit, they can help you sort your papers. Furthermore, they can help you recognize scams before you make a mistake. Here are the most successful scams of this year.

Offshore Accounts

There are legitimate reasons to have money in offshore accounts, but a lot of people do it simply to avoid paying taxes in the USA. The IRS used to largely disregard these incidents and focus primarily on the home turf.

However, over the past several years, they have tightened the control over the offshore accounts as well. People who attempt to hide these accounts may be facing serious legal repercussions, including incarceration. To incentivize people to report their offshore accounts, the IRS has started the Offshore Voluntary Disclosure Program, which enables people to report the previously hidden accounts without fear of prosecution. You can learn more about OVDP here

Phishing Scammers

If you ever receive an email requiring some of your personal data, especially something as sensitive as your bank account number or your social security number, you need to be extra careful. It is most likely a phishing scam. When it comes to bank account scams, the most common one is particularly insidious.

It starts by scammers depositing some money on your account. Once the money is on your account, they contact you and ask for the money back. However, they pose as IRS agents or some sort of a debt collection agents. You should know that the IRS never asks for your sensitive information via email.

Identity Theft

 This is one of the most notorious scams, and it has been for a very long time. Essentially, if a scammer gets ahold of your social security number or your individual taxpayer identification number. If successful, they can pose as you and claim your tax return.

Even though the IRS claim that they have managed to curb this problem, you should still be careful where and with whom you share your personal information. Only use the software you trust and make sure you have an antivirus and a firewall enabled on all devices you use.

False Charity Organizations

Many people decide to give money to charity in order to qualify for some tax deductions, which is a mutually beneficial relationship. However, if you are looking to donate, make sure to double check the organization you are giving to.

There are some organizations out there who only pose as charities. Some go so far to mimic actual charities both in name and logo design in order to attract donations. Needless to say, your money won’t help any charity and you won’t qualify for a tax deduction.

So, before you donate, make sure to double check the organization and to never leave your sensitive information like a social security number. What’s more, it is advisable to pay via check or credit card in order to have a paper trail.

This is just a snippet of the different tax scams that people attempt each year. You can find the rest of them on the official IRS website if you want to learn more about scams and how to protect yourself.