The IRS and its Security Summit partners – the state tax agencies and the tax industry – urge taxpayers to remain alert to tax scams year-round, especially immediately after the tax filing season ends. Even after the April deadline passes, the tax scam season doesn’t end.
While many of the scams are variations on a theme and tend to evolve over time, taxpayers should be on the lookout for any attempt to get them to disclose personal information like Social Security numbers, account information or passwords. If in doubt, don’t give it out. Those receiving such calls should hang up and initiate correspondence with the agency that is purportedly inquiring about their account using a well-known phone number or email address. Clicking on links provided in emails or calling back unfamiliar phone numbers is not recommended.
Even though reports of tax-related identity theft have declined markedly in recent years, the Internal Revenue Service warns that this practice is still widespread and remains serious enough to earn a spot on the agency’s annual “Dirty Dozen” list of tax scams.
The Dirty Dozen is compiled each year by the IRS and outlines a variety of common scams taxpayers may encounter any time during the year. Many of these cons peak during filing season as people prepare their tax returns or hire tax professionals.
Tax-related identity theft occurs when someone uses a stolen Social Security number or Individual Taxpayer Identification Number (ITIN) to file a fraudulent tax return claiming a refund.
The IRS, the states and the tax industry began working together in 2015 as the Security Summit to fight tax-related identity theft. Security Summit partners enacted a series of safeguards that are making inroads against identity thieves.
For example, the number of taxpayers reporting themselves as identity theft victims declined by 40 percent in 2017 from 2016. In 2017, the IRS received 242,000 reports from taxpayers compared to 401,000 in 2016. This was the second year in a row this number fell, dropping from 677,000 victim reports in 2015. Overall, the number of identity theft victims has fallen nearly 65 percent between 2015 and 2017.