How to protect yourself from tax fraud

Austin, Texas – The new year and the new tax season bring new opportunities for tax-related fraud.

“We see these fear tactics play out every once in a while this part of the year,” said Jason Meza, senior regional director at the San Antonio Better Business Bureau serving the heart of Texas.

Fraudsters often inspire and profit from the fear of missed deadlines, the fear of losing money, and the fear of breaking the law.

During the tax season, this manifests itself in different ways.

“The BBB is generally seeing an increase in reports of scams, impostor scams, people getting phone calls, texts and emails claiming they have outstanding debt, claiming they need to settle something quickly. before action is taken against them,” Meza said.

And after the pandemic, there could be lingering confusion.

“During the pandemic, we saw tax deadlines shift, everything stretched out and there was confusion,” Meza said. “I think the scammers are playing very well on this confusion.”

One example of a possible scam is receiving a phone call where the caller claims to be from the IRS and demands payment. The IRS will almost always mail the letter and will not require immediate payment without providing an opportunity to appeal.

Before filing, beware of scammers posing as tax preparers, also known as “ghost preparers”. They will claim legitimacy and may promise a very large tax return.

“With the advent of social media, we are also seeing accounts get hacked and people get friend requests or friend suggestions saying, ‘You should join this great tax program or you don’t have enough tax credits, click here.’” Meza said.

There were 52,000 tax-related fraud reports filed with the IRS in 2021 and a loss of $1.6 billion, according to the BBB.

Meza said the best action to take to avoid being scammed is to start the application process early — before the scammers have a chance to steal information or money.

The new feature could also provide improved security. Taxpayers can now request an IPP (Identity Protection Pin) when applying. Even if the fraudster gets a Social Security number, they will also need an IPP to file someone else’s tax return.

“I think the key thing to remember is that the IRS will never demand payments, they won’t threaten you with arrest or deportation, and look out for those unexpected calls for any refunds,” Meza said. “And they’re not going to initiate contact via text messages or social media — they’ll text you first.”

For more tips from the BBB, click here.