IRS ‘Dirty Dozen’ Tax Scams for 2014, Part 1 — Phishing, Identity Theft & More
Tax season is upon us. Doing your taxes is unpleasant enough already, but there are also some shifty characters out there who want to make the pain even worse. Thankfully, the IRS keeps an eye out for low down, no good, dirty tax scams, and each year the tax agency releases its "Dirty Dozen" schemes that you should make yourself aware of. Today we'll take a quick look at the first half of the list:
1. Hiding Income Offshore
People who don’t have a legitimate reason to keep their money in foreign accounts, but do so anyway, are at the top of the list of tax offenders. The IRS hopes to collect back taxes from these folks through the Offshore Voluntary Disclosure Program (OVDP).
Unsolicited emails or phony websites lure people into a phishing scam. Once the target gives up his or her information, the scammers will rip the person off financially, or commit some type of identify theft.
3. Identity Theft
After someone gets hold of your Social Security number (SSN) or another form of personal identification, the scammer can proceed to file a fraudulent tax return, and ask for a (fraudulent) tax refund.
4. “Free Money” Promises from Inflated Refunds
Fake tax preparers offer massive federal tax refunds, which are, of course, fake as well. The money they charge you for their fake services, however, is very real.
5. Widespread Telephone Scams
Someone offering you money, demanding money, handing out threats or other scams over the phone line is a major problem in the United States. Beware of something too good to be true, or too horrible and aggressive that doesn’t make logical "tax sense."
6. Tax Return Preparer Fraud
Hopefully your tax professional is on the up-and-up, but you need be careful. Even licensed tax preparers can rob you of your hard-earned cash.