IRS Warns Taxpayers To Beware Of New Tricks By Tax Scam Artists [Video]

In recent months, new tax scam tricks and variations have materialized. Taxpayers are warned to remain on high alert and protect themselves against the increasing amount of fraudulent tactics tax scam artists use to trick people.

The Internal Revenue Service (IRS) issued a consumer alert providing taxpayers with tips to protect themselves from tax scam artists calling and pretending to be with the IRS. These fraudulent activities are occurring over the telephone, in emails, or through authentic-looking letters with the IRS letterhead. Tax scammers try tricking taxpayers into providing personal financial information by means of scaring people into making a false tax payment that ends up with the criminal.

The Treasury Inspector General for Tax Administration (TIGTA) reports of roughly 600,000 contacts since October 2013. TIGTA is also aware of nearly 4,000 victims who have collectively reported over $20 million in financial losses resulting from tax scams.

IRS Commissioner John Koskinen offered his comment about the ever-evolving tax scam increase.

“We continue to see these aggressive tax scams across the country. Scam artists specialize in being deceptive and fooling people. The IRS urges taxpayers to be extra cautious and think twice before answering suspicious phone calls, emails, or letters.”

According to the IRS, tax scam criminals pose as IRS agents. First, they target people they view as most vulnerable, such as older Americans, newly arrived immigrants, and those whose first language is not English.

In a CBS 4 interview, Colorado Attorney General Cynthia Coffman stresses that education is the key to stopping a tax scam.

“There has been an increase in calls to Spanish-speaking communities — to Hispanic and Latino customers. It’s immoral. It’s just so unfair to do this to a community that’s already struggling living paycheck to paycheck.”

However, the IRS reports these criminals have extended their net and are now targeting nearly anyone.

One of the newer tax scam tricks involves a deceitful variation. Tax scammers change what appears on your telephone caller ID to make it appear as if they are with the IRS or another agency such as the Department of Motor Vehicles.

Taxpayers Paying Taxes In 1150.
Officers receiving and weighing coin from taxpayers at the Exchequer in Westminster, London. Circa 1150. (Photo by Hulton Archive/Getty Images)

In addition, they use fake names, titles, and badge numbers. In order to sound official, using online resources, tax scammers get a potential victim’s name, address, and other relevant details about their life. They also copy official IRS letterhead to use when sending emails or mail through the post office.

Tax scam perpetrators even provide victims with directions to the nearest business or bank where the victim can obtain a means of payment such as a debit card. In an attempt to make the tax scam come across as being official, another new trick involves con artists providing an actual IRS address where the victim can mail a receipt for the payment.

Of all the tax scam tricks being used by con artists, the most common ploy is fear. Tax scammers try to scare people and persuade the victim into reacting immediately without giving much thought into what is really happening.

In many cases, a tax scam artist will act angry — they threaten their victims of police arrest, license revocation, deportation, or other equally unlikable circumstances. In some cases, they may leave urgent callback requests, sometimes through telephone or email. The emails most often contain a phony IRS document with an email address or telephone number as a way for the victim to reply.

The Internal Revenue Service advises consumers that it is important to remember the official IRS website is IRS.gov. People are urged not to be misled or confused by sites claiming to be the IRS but ending in .org, .net, .com, or other designations.

Most importantly, citizens should never provide personal and financial information to suspicious websites or strangers who call unexpectedly.

Felipe Castro Holding A Tax Sign
Felipe Castro holds a sign advertising a tax preparation office for people that still need help completing their taxes before the Internal Revenue Service deadline. (Photo by Joe Raedle/Getty Images)

Tax scam artists are known to do five things that real IRS agents would never do.

For example, the IRS will never angrily demand immediate payment over the telephone. The agency will not call about taxes owed without first mailing a bill to the taxpayer.

The IRS will never threaten to send local police or other law enforcement groups to arrest someone for not paying. In addition, they won’t demand that a taxpayer pay a bill without giving the consumer the opportunity to question or appeal the amount the agency says the citizen owes.

The IRS does not require a taxpayer to use a specific payment method for paying their taxes, such as a prepaid debit card. Additionally, they will not ask for debit or credit card numbers over the telephone.

For the most part, the IRS tax scam has been difficult for law enforcement. They continue to get complaints and the criminals are extremely hard to track down. The scammers spoof phone numbers, using burner phones, and are hard to trace since many of them are on foreign soil.