Friday, February 18, 2011

Recent Tax Scams You Should Know About

Scam artists are always on the lookout for ways to get your financial information. Tax season, when we’re all thinking about our W-2s, deductions and tax preparation, provides just another chance to dupe people. To help avoid becoming another identity theft victim, check out these new tax scams everyone should know about.

Free Tax Preparation Emails

Many tax preparation companies advertise free federal filing promotions each tax season. Not surprising is that email scammers have used those promotions to fool people into handing out their personal information. The latest scam involves an email offer for free tax help, and requests taxpayers provide a wealth of personal and financial information. Instead of using that information to prepare a tax return, the scammer steals your information in order to rob you blind. If you are going to file your return online, make sure you are doing so through a trusted and secure site, not one that sends you a scammy email advertisement.

W-2 Scam

Last month the Better Business Bureau issued a warning about a new scam wherein a taxpayer is asked to provide information from their W-2 online. Please remember, the IRS will not contact you via email to ask for personal information. W-2 forms are submitted by employers, not prepared by taxpayers. If the IRS truly has questions about your tax forms, they will send you a letter through the mail.

EFTPS Payment Emails

Another new email scam, that bloggers began noticing towards the end of 2010, is an email claiming to be from the IRS regarding the Electronic Federal Tax Payment System (EFTPS). Although the links did eventually forward you to the EFTPS site, they first went through a redirect that would install spyware on your computer. Of course, with the spyware installed on your computer, as soon as you entered any personal and financial information into the EFTPS, the scammer had everything they needed to steal your identity and your hard earned cash.

Treasury Department Requests

Although this one may seem obvious, you should always ignore emails from senders claiming that you are being awarded a refund or tax inheritance. These emails sometimes claim they are contacting you on behalf of the Treasury Department and need you to provide banking information in order to get the funds. Please remember, that government entities will not make their first contact with you an email.

How to Avoid Tax Scams

It is easy to avoid becoming the victim of tax related identity theft if you follow these 3 basic rules:

1. Do not open any attachments in emails from groups claiming to be the IRS, or offering free tax advice. If you are interested in an advertisement that shows up in your inbox, contact the company over the phone.

2. Do not reply to any emails with personal tax or financial information about yourself. The IRS will never request information such as your social security number, or any financial information, through an email. As a general rule avoid doing business with any company asking you to send personal information via email. Even if the company is legitimate, emailing sensitive information poses a serious security risk. A

3. Do not click any links from organizations you do not recognize. Even if the link appears to be from the IRS.

How to Report Questionable Emails

If you get an email that you think might be part of a tax scam, you should send it to the IRS to investigate. Simply forward it to, and delete the message from your inbox.

Here’s wishing you a safe and secure tax season!

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