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Posted On December 18, 2016
Don’t let a tax scam steal your holiday cheer

Don’t let a tax scam steal your holiday cheer

Dr. Seuss’s Grinch famously tried to steal Christmas. In their own way, tax scammers try to do this as well.

To be sure, tax scams occur all year round, not only around the holidays. But fraudulent schemes aimed at taxpayers spike when a new filing season arrives.

With the filing season for 2016 taxes opening next month, it’s a good time to review steps you can take to avoid scams.

One important fact to remember is that the IRS does not make initial contact with you by phone or email. If you get an unsolicited email from someone claiming to be an IRS agent, it’s likely to be a “phishing” scam. These scams try to get personal information such as your Social Security number from you in order to commit identity theft or other crimes.

Similarly, someone calls out of the blue and demands immediate payment on a prepaid card to settle tax debt is likely a scammer. Even if you do owe money, you have rights to collection due process before the IRS takes action against you.

Besides being wary of scammers posing as IRS agents, what else can you do to protect yourself from tax scams?

One thing you can do is file early. If you get your taxes filed right away, scammers can’t try to commit tax refund fraud by filing on your behalf. Filing electronically is also an important protective step, because it keeps your personal information from potentially being diverted in the mail and ending up in the wrong hands.

Professional tax preparers are also exposed to scams. Many preparers have been victimized by bogus emails that infected their computers with malware by scammers trying to extract personal information. If you use a preparer, it therefore makes sense to ask about ways to steer clear of scammers.

In short, protecting yourself against tax scams is not as straightforward as watching out for the Grinch. There are steps you can take, however, to minimize the risks, even as you enjoy the holidays.