IRS Scam Artists Are Getting Smarter: How to Detect and Avoid IRS Imposter Scams

IRS Scam Artists Are Getting Smarter: How to Detect and Avoid IRS Imposter Scams

by | Oct 21, 2024 | Articles, blog, For Individuals, Latest News, Newsletter Article, Personal

2 minute read

IRS impostors are becoming more sophisticated, and taxpayers are falling victim. According to the Federal Trade Commission (FTC), nearly $5 million have been scammed from unsuspecting Americans over the last five years. Read on as we discuss how these scams work and how to protect yourself from falling victim.

Scamming Tactic

The latest scam relies on creating a sense of urgency and fear, so it’s crucial to recognize the red flags. Targets of this scam will receive a call from impersonators with fake IRS credentials falsely claiming that the victim owes overdue taxes. These scammers often know some personal information about the victim, which enhances their credibility and lends authenticity to the scam. The supposed “agent” will threaten the victim with severe consequences such as arrest or legal action if immediate payment is not made. The scammer will demand payment through methods that are hard to trace, such as wire transfers or gift cards.

Targeted Groups

Scammers are increasingly targeting specific groups who may be more vulnerable to their schemes. These targets include the elderly due to potential isolation and a lack of familiarity with modern technology; those with hearing or vision impairments because they might struggle to verify the authenticity of communications; individuals with cognitive impairments because they may find it challenging to distinguish between legitimate and fraudulent interactions; and those who speak English as a second language, as they may not understand IRS procedures or the nuances of scam warnings.

How to Safeguard Yourself

To avoid falling prey to IRS impostor scams, know the methods they use to contact individuals. The IRS will never demand payment through phone calls or ask for payment via gift cards or wire transfers. They usually communicate through official letters sent by mail.

If you receive a phone call from someone claiming to be from the IRS, hang up and contact the IRS directly using their official phone number, which you can find on their website. This ensures that you are dealing with a legitimate representative. Additionally, never share personal or financial information over the phone unless you have verified the identity of the caller. Scammers may use a variety of tactics to appear legitimate, but being cautious with your personal information is key.

It’s also important to report any suspicious activity to the Federal Trade Commission (FTC) and the IRS. The FTC provides a platform for reporting scams, which helps authorities track and address fraudulent schemes. Informing others, especially those who might be more susceptible, such as elderly family members or individuals who are not fluent in English, can also help prevent these scams from causing harm.

Proper Steps to Address Tax Issues

If you genuinely owe back taxes, make payments through the IRS’s secure online payment portal or by check. If you are unsure about your tax situation, seeking advice from a tax professional can provide clarity and assistance by helping you navigate your tax obligations and explore options for managing any outstanding debts.

The IRS also offers payment plans for those who cannot pay their taxes in full immediately. Contact the IRS directly to discuss your financial situation and arrange a manageable payment.

 

About the Author

Rob is a CPA and has been in public accounting since 1993 after graduating from Ball State University with a Bachelor of Science degree in accounting. Rob became co-owner of the firm in 2003. Rob provides services to many types of industries; including, manufacturing, trucking, construction, service, and retail.

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