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This Tax Season, Beware of Tax Fraud

by User Not Found | Mar 30, 2015

by Jon Stockton

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It's tax time, and fraudsters are hard at work devising ways to scam people out of their refund checks. Last year alone, scammers stole billions of dollars from consumers by filing bogus tax returns and pocketing the refund checks.

The IRS has made inroads in preventing this type of tax fraud—but reports that, this year, fraudsters are increasingly targeting tax refunds at the state level.

You can protect yourself from tax refund fraud by being aware of and on the lookout for the following refund fraud indicators:

  • Calls claiming to be from the IRS asking for sensitive personal and financial information over the phone and threatening dire consequences if this information is withheld.
  • After filing, you receive a notice from the IRS stating that “more than one tax return was filed with this information.”

If you believe that you have been the victim of tax fraud, it is advisable that you take the following steps:

  • File a report with your local police department.
  • Report the theft to the Federal Trade Commission by calling 877-438-4338 or visiting ftc.gov/complaint.
  • Contact the credit bureaus to inform them that you have been a victim of tax refund fraud and to ask that they place a fraud alert on your account.
  • Consider closing affected bank or credit card accounts, as refund thieves now likely have access to some of your sensitive financial information.
  • Respond to all inquiries from the IRS in a timely fashion. In all of your communications with the IRS after an instance of refund theft, be sure to include the name and number that appear on the notice. Remember, more than one return may have been filed under your name, so it is important that you keep track of all notices that you receive.

While the IRS is committed to aggressively prosecuting tax fraud criminals, fraudsters are finding ever more creative ways to separate people from their money. This tax season, keep your eyes and ears open and your personal information safe, to ensure that your tax refund ends up where it belongs: with you.

 

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