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Tax time means tax scams, so watch out

Posted by Mitch Lipka  February 27, 2012 12:34 PM

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Dealing with taxes can be rough enough without having to worry about scams. To avoid them, you need to recognize them, so here are a few the Internal Revenue Service says are among the most prevalent during tax season.

One scam you’re likely to see will come through your email. Phishing scams try to get recipients to believe they have to respond to an email soliciting personal and financial information typically used to commit identity fraud.

The IRS warns that the emails could appear to come from the IRS or other related entities, including the Electronic Federal Tax Payment System.

“It is important to keep in mind the IRS does not initiate contact with taxpayers by email to request personal or financial information,” the IRS said in its annual scam warning. “This includes any type of electronic communication, such as text messages and social media channels.”

If you get one of those emails, the IRS asks you to forward it to phishing@irs.gov.

Another big problem for the IRS and taxpayers is identity theft. That’s when someone else files taxes using your Social Security Number to try to collect a refund.

If the IRS receives more than one return using the same name and Social Security number, a notice should be sent to alert the taxpayer another return has been submitted. If you have any reason to suspect someone might be using your personal information, visit www.IRS.gov/identitytheft. The IRS claims it thwarted attempts to steal $1.4 billion through identity theft scams last year.

Another potential problem, according to the IRS, is fraud by tax preparers. There are plenty of well-qualified, legitimate tax preparers out there, should you choose to go that route. But the IRS says to watch for these signs of trouble:

  • Preparers don’t sign returns or include the Preparer Tax Identification numbers;
  • They charge a fee that’s a percentage of your refund;
  • They try to get you lie on your return by creating phony income or expenses.

Lastly, remember that refund anticipation loans make money for lenders and cost you. Refunds on electronically filed returns come quickly. It’s worth the wait.

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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About the author

Mitch Lipka is one of America's leading consumer journalists and advocates. He is an expert in product safety, recalls, scams, and helping consumers get out of jams. He is a nationally known consumer columnist and runs TheConsumerChronicle.com. He lives in Worcester. You can find him on Facebook or reach him at ConsumerNews@Aol.com

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