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Financial Education

Tax Scams You Need to Know About

Each year the IRS releases a list of tax scams that are currently affecting many individuals. The number of different scams seems to steadily increase each year, with fraudsters becoming more proficient in their targeting methods. This year, there is more for taxpayers to be mindful of with COVID-19 and economic impact payments setting the stage for tax scams. As your credit union, our goal is to prepare you for these potential scams so you can knowingly avoid them. Below is a list of the most popular tax scams and how not to fall victim to them.

Tax-Related Phishing Schemes

These schemes are what they sound like – fishing expeditions. Your private information, personal information, and financial information serve as the coveted prizes. With these schemes, scammers attempt to connect with you through email, text messages, and even social media. What to know about these schemes: First, the IRS will NEVER contact you through these mediums. Instead, if you owe Uncle Sam, he will only contact you through the mail. Also, the IRS does not accept payment in the form of gift cards, prepaid debit cards, or wire transfers.


Safety When Filing Electronically

Another growing problem involves fraudsters seeking to steal your tax refunds by filing in your name. You can mitigate this by making sure your computer, tablet, or phone has the latest security updates available as well as protection against viruses, malware, and ransomware before uploading your tax information. Also, don’t access the Internet via public networks when transmitting private information. Always make sure you’re on a secured network. Finally, file your taxes early so that no one else will have the opportunity to file in your name.

Threatening Phone Calls Pretending to Be from the IRS

These phone calls often demand immediate payment from frightened taxpayers with the threat of fines or jail time for failure to pay some bogus tax bill. In some instances, these are conducted by “robocalls” with instructions about how to return the call or submit payments. Contact the IRS if you receive these types of threats or if you have concerns about owing the government money. The key is to never send money in these situations, as it is most likely a scam. The IRS doesn’t typically make demands for immediate payment from taxpayers or threaten them over the telephone. Again, the IRS will only contact you through the mail with tax-related issues.

Protect Yourself

The IRS continually updates its website with information on the latest scams going around the World Wide Web, as well as recommendations on steps you can take to protect yourself. The Federal Trade Commission (FTC) is another excellent resource for information about protecting your identity and improving your online security. If you have been a victim of identity theft or tax-related fraud of any kind, you can find the steps you need to take on the FTC website as well.

We’re Here to Help!

If you feel you may have been a victim of identity theft or have questions on a possible scam, please contact us at your earliest convenience. You may stop by any of our convenient branch locations or call us at 618-457-3595. We’re always here to answer your questions and provide financial advice on the best ways to invest your tax refund.

Each individual’s financial situation is unique and readers are encouraged to contact the Credit Union when seeking financial advice on the products and services discussed. This article is for educational purposes only; the authors assume no legal responsibility for the completeness or accuracy of the contents.

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