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How To Avoid Tax Scams in 2024: Protect Your Finances and Stay Safe


Tax season is here, and with it comes an increase in tax scams. These fraudulent operations attempt to fool unassuming taxpayers into giving up their personal and financial information for the purpose of filing false tax returns and claiming refunds. This blog post will discuss the most common tax scams as well as provide you with practical advice on how to avoid falling victim to them.

   Spot Phone Scams

One of the biggest dangers during tax season is phone scams. Scammers frequently pretend to be from the IRS and demand immediate payment for fictitious taxes or threaten to send the police to someone’s home. These types of callers may insist that they work for the IRS, stating that payment must be made over the phone by credit card or wire transfer. They might even go so far as to say your driver’s license will be suspended if you don’t comply with their demands.

No person claiming to be from the IRS will ever require you to make a payment on the spot or threaten you with sending the police. Authentic IRS representatives have the ability to advise you on your rights as a taxpayer which include but are not limited to questioning your bill and being given a clear explanation of what you owe. If you get a call from someone who claims they are with the IRS, hang up immediately and report this to the IRS either through their website or by calling 800-366-4484. These criminals might seem very convincing and use aggressive tactics to scare you into doing what they want so don’t engage them in conversation.

   Don’t Pay Fake Taxes

Scammers sometimes reach out to individuals about supposed taxes like the “Federal Student Tax,” demanding payment. There isn’t any such thing as the Federal Student Tax so this is clearly a scam. In case you suspect any person of trying to scam you hang up the phone and report it to the IRS immediately. Don’t pay any taxes that seem suspicious because if you do then there’s potential for financial loss or legal trouble.

   Check out the Charity

Giving to charity is a great way to reduce your tax bill – but only genuine charities qualify. Fraudsters may ask for donations for non-existent charitable organisations, saying you can deduct it from your tax. Verify an organisation’s authenticity before you donate to it if you’re unsure about them: look them up online or use the IRS’s Tax Exempt Organization Search tool.

   Avoid Phishing Emails

Another widespread scam involves phishing emails that try to get hold of your money or personal details. They might pretend to come from the IRS and ask you to follow a link and fill in some information. However, be aware that the IRS will never send an email that demands you share personal information by clicking on a link. Treat any email asking for sensitive data with suspicion – and don’t open attachments or emails that seem dodgy, especially if they are from senders you don’t recognize.

   Don’t Delay

It is possible for you to file your taxes without hearing anything from the IRS about them having received your return. Suppose you wait until the eleventh hour to file, only to discover someone has done so already using your name – this poses a problem. Scammers have the ability to target not only your personal finances but also those belonging to your employer. An individual who gains unauthorized entry into your W-2 forms by way of your employer could then file tax returns in your name while you remain oblivious for quite some time, maybe even weeks or months. The longer you procrastinate, giving criminals more opportunities for perpetrating this fraud. Act fast and take charge –submit your taxes immediately.

   Check the Identity of the Person You Talk To

Scammers may pretend to be IRS and FTC agents, fraud investigators, debt collectors, co-workers or even family members. They might bring up legitimate charges you’ve made recently or your tax return, maybe saying you filed it wrong or that your identity was stolen. HSPD-12 is the official identification card that Internal Revenue Service employees get. Try to get it out of anyone who claims to work for them but can’t provide their HSPD-12 card; they’re most likely lying about being from the IRS. Similarly, ensure your tax preparer has a valid preparer tax identification number (PTIN) before handing over any personal details.

   Keep Up-to-date

Every year, the IRS issues a list called The Dirty Dozen which highlights the most common scams people face during tax season. Make sure you know what’s on this list and understand the methods used by swindlers. Also, verify the legitimacy of any charity before you donate money to them as well as being wary of unsolicited offers or requests for personal information in general.

   Be Wary of Unsolicited Offers

Offers may come from scammers who claim they can help with taxes or offer to prepare them instead. Even if these offers seem helpful – especially when unsolicited – stay cautious because legitimate tax preparers won’t reach out asking for your personal details without a good reason. Always research a potential preparer’s credentials and check if anyone has complained about their services before.

Protect Your Personal Information

Many tax scams involve stolen personal information. When sharing your personal information, be careful who you share with and how you share. Use strong passwords and keep them secret. Unless you are sure they’re legitimate, do not give your Social Security number or other sensitive information to anyone.

Report Suspicious Activity

If you believe you have been a victim of a tax scam, report it to the IRS right away. You can report any suspicious activity to the IRS online or by calling 800-366-4484. You can also report it to your local police department or the Federal Trade Commission (FTC).

Be informed and take control this tax season to protect yourself from falling victim to such fraudulent schemes.

Additional Tips

  • Review your tax return carefully before submitting to make sure all information is accurate and complete.
  • Secure internet connection should be used when filing tax return online.
  • Keep up-to-date with the latest security patches for your tax software and operating system.

* Use a trustworthy tax preparation company and verify that they have a valid PTIN.

* Be careful about unsolicited offers or requests for personal information.

* Inform the IRS and your local police department immediately if you notice anything unusual.

By following these advices, one can save oneself from tax cheats and have a secure and successful tax period.