Invest Wisely

Important Tips to Avoid Tax Return Fraud

by Mark Sander5 min read
Important Tips to Avoid Tax Return Fraud

Before you file your tax returns, you need to be aware of tax return fraud and how to avoid scammers. You may be wondering how to file your taxes correctly and what kind of tax refunds you could get. You may think of hiring an accountant or considering doing it on your own using an online service. But there is something you must be careful of.

In the previous year, the IRS reported that there have been several fraud investigations though they have decreased. However, tax scams are still there and they find a way to do tax return fraud. Here are the ways for you to avoid being victims to tax return fraud.



File Immediately to Avoid Tax Return Fraud

There are a lot of reasons to file early to avoid fraud. It will lower the chances that someone can take advantage of you because that is how scammers work. They will file a fake tax return by making you believe that they are doing it before you. So, the faster you file, the less chance they will have to get ahead of you.


Clear Your Email Inbox

The information that criminals would need to file a fake tax return in your name would be your complete legal name, date of birth, and SSN. Track how many people you have sent this information to. It could be the W-9 you have sent to an employer, a copy of your passport to a travel agency or a form you have filled out to send to your healthcare provider.


Do not keep such communication with your sensitive information in your email inbox. In addition, you should also shred old physical documents that contain such information. You can invest in an affordable paper shredder to securely dispose of billing statements, account statements, along with other financial documents that you would no longer use. Most identity theft happen from the trash.


Do Not Answer Calls Claiming that It’s From the IRS

The IRS will never call you so if you receive any calls that say they are from the IRS, it is better to hang up. This is some modus that scammers often use. They will call and tell you that they are from the IRS and that you need to send them payments. It may sound legitimate and provide you with a fake IRS number. They may even give you information that will make you believe they know who you are but it is a tax return fraud.

It could also be a voice recording that claims to be from the Criminal Investigation Department of the IRS. They would demand that you call them back to make a payment or you may have your properties seized by the IRS. It is best to hang up because there is no way that the IRS will call you. They would not even send an email. Even if you are subject to auditing or have acquired penalties, the IRS will only communicate with you via physical mail.



Call Your Financial Institution on an Official Number

If you receive a call saying that it’s about your credit card or bank account, it’s best to call them back on an official number. Scammers can pose as a bank representative or someone from your credit card company which can be difficult to catch because it is highly possible for your bank to call you.

Another way they do this is to send you an email asking you to verify your personal information. You will know that it is scam if it is accompanied by a threat such as your account being closed if you do not provide the information. A lot of people have fallen into the trap. If you have questions about your bank account or your credit card bills, call the company using their official customer service number. Do not take inbound call requests.


Do Not Sign a Blank Return

If someone says they will take care of your tax return form and all you have to do is sign, do not do it. Some tax return fraud scammers will offer to do your taxes and tell you to simply sign the form and they will do it for you.