IRS Warns of Continued Scams, Varied Tactics as the Tax Deadline Nears
IR-2016-62, April 13, 2016
WASHINGTON — The Internal Revenue Service today issued a warning that scammers may try using the April 18 tax deadline to prey on hard-working taxpayers by impersonating the IRS and others with fake phone calls and emails. Even after the tax deadline passes, taxpayers should know the telltale signs of a scam and tips to protect themselves from a variety of phone scams and phishing emails.
"We’ve seen continuing activity in these scams throughout the filing season," said IRS Commissioner John Koskinen. "As the tax deadline nears, these criminals may try and trick honest taxpayers over the phone or via email, and people should remain vigilant. After the tax deadline, watch out for these scammers promising a refund or threatening you with an unexpected tax bill."
These scam artists frequently masquerade as being from the IRS, a tax company and sometimes even a state revenue department. By email, they try enticing people to click on links in official-looking messages containing questions related to their "tax refund." Report these emails to firstname.lastname@example.org. By phone, many scammers use threats to intimidate and bully people into paying a "tax bill." They may even threaten to arrest, deport or revoke the driver’s license of their victim if they don’t get the money.
Variations of these scams can be seen nationwide, and it’s more important than ever to be cautious with providing personal or financial information. As part of the effort to protect taxpayers, the IRS has teamed up with state revenue departments and the tax industry to make sure taxpayers understand the dangers to their personal and financial data as part of the “Taxes. Security. Together” campaign.
Some examples of the varied tactics seen this year are:
Soliciting W-2 information from payroll and human resources professionals (see news release IR-2016-34)
“Verifying” tax return information over the phone (IR-2016-40)
Pretending to be from the tax preparation industry (IR-2016-28)
There are some important reminders for taxpayers nationwide about these schemes.
Watch Out for Threatening Phone Calls
Beware of scammers making unsolicited calls claiming to be IRS officials. They demand that the victim pay a bogus tax bill. They con the victim into sending cash, usually through a prepaid debit card or wire transfer. They may also leave “urgent” callback requests through phone “robo-calls,” or via a phishing email.
Scammers often alter caller ID numbers to make it look like the IRS or another agency is calling. The callers use IRS titles and fake badge numbers to appear legitimate. They may use the victim’s name, address and other personal information to make the call sound official.
The IRS Will Never:
Call to demand immediate payment over the phone, nor will the agency call about taxes owed without first having mailed you a bill.
Threaten to immediately bring in local police or other law-enforcement groups to have you arrested for not paying.
Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.
Require you to use a specific payment method for your taxes, such as a prepaid debit card.
Ask for credit or debit card numbers over the phone.
If you get a phone call from someone claiming to be from the IRS and asking for money and you don’t owe taxes, here’s what you should do:
Do not give out any information. Hang up immediately.
Contact TIGTA to report the call. Use their “IRS Impersonation Scam Reporting” web page or call 800-366-4484.
Report it to the Federal Trade Commission. Use the “FTC Complaint Assistant” on FTC.gov. Please add “IRS Telephone Scam” in the notes.
If you think you might owe taxes, call the IRS directly at 1-800-829-1040.
Avoid Email Phishing Attempts
There has been a surge in email scams this year that appear to be from a tax agency or a tax software company.
Never reply to emails, texts or pop-up messages asking for your personal, tax or financial information. One common trick by criminals is to impersonate a business such as your financial institution, tax software provider or the IRS, asking you to update your account and providing a link. For small business, these schemes may try impersonating a company leader and request payroll and human resource information for employees in your company. Never click on links even if they seem to be from organizations you trust. Go directly to the organization’s website.
And if it sounds too good to be true, it probably is. If you see an email that says "You won a free cruise" or "The IRS has a refund waiting for you," odds are high that it is a phishing attempt looking to get your personal information.
If you get a phishing email, remember this important advice:
Don’t reply to the message.
Don’t give out your personal or financial information.
Forward the email to email@example.com. Then delete it.
Don’t open any attachments or click on any links. They may have malicious code that will infect your computer.
More information on how to report phishing or phone scams is available on IRS.gov.
Fact sheet FS-2016-1, IRS, States and Tax Industry Combat Identity Theft and Refund Fraud on Many Fronts
FS-2016-2, IRS, States and Tax Industry Urge Taxpayers to Join the Effort to Combat Identity Theft
FS-2016-3, IRS Identity Theft Victim Assistance: How It Works
FS-2016-4, How New Identity Security Changes May Affect Taxpayers for 2016
Many Hurricane Victims Qualify for Earned Income Tax Credit; Special Method Can Aid Workers Whose Income Dropped
WASHINGTON – The IRS is urging victims of last year’s hurricanes, especially those who lived in areas affected by Hurricanes Harvey, Irma and Maria, to see if they qualify for the Earned Income Tax Credit (EITC). According to the IRS, many people whose incomes dropped in 2017 may be eligible to choose a special option for figuring the EITC, a credit for low- and moderate-income workers and families.
A special computation method, available only to people who lived in one of the hurricane disaster areas during 2017, may enable them to claim the EITC or claim a larger than usual credit. Under this method, taxpayers whose incomes dropped in 2017 can choose to figure the credit using their 2016 earned income rather than their 2017 earned income. Eligible taxpayers should figure the credit both ways -- the regular way using 2017 earned income and this special way using 2016 earned income -- to see which yields the larger EITC. For more information and special instructions on how to report, see the instructions for Form 1040, Line 66, and Publication 976, available on IRS.gov.
The EITC helps working people who don't earn a lot ($53,930 or less for 2017) and meet other eligibility requirements. Because it’s a refundable credit, those who qualify and claim it could pay less federal tax, pay no tax or even get a refund.
EITC can mean up to a $6,318 refund for working families with qualifying children. Actual credit amounts vary based on income, family size and other factors. Workers without a qualifying child with incomes below $20,600 could also be eligible for a smaller credit of up to $510. On average, EITC adds $2,445 to refunds.
To qualify for EITC, an eligible taxpayer must meet basic rules and have earned income from working for someone, being self-employed or running a business or farm. This includes home-based businesses, the sharing economy and employment in the service, construction and agriculture industries. In addition, certain disability payments may qualify as earned income for EITC purposes. The EITC Assistant, available on IRS.gov, can help taxpayers determine eligibility and estimate the amount of their credit.
To get the credit, people must file a tax return, even if they owe no tax and even if they normally aren’t required to file. The fastest and easiest way to do so is by filing electronically, whether through a qualified tax professional; using free community tax help sites; or self-preparing with IRS Free File.
By law the IRS cannot issue refunds before mid-February for tax returns that claim the EITC or the Additional Child Tax Credit (ACTC). The IRS must hold the entire refund — even the portion not associated with EITC or ACTC. This change helps ensure taxpayers receive the refund they deserve and gives the agency more time to detect and prevent errors and fraud.
The IRS expects the earliest EITC/ACTC related refunds to be in taxpayer bank accounts or debit cards starting Feb. 27, 2018, if they chose direct deposit and there are no issues with the tax return.