With the 2014 tax season starting to wind down, an IRS watchdog issued a warning on Thursday, March 20th of a major phone scam affecting taxpayers across the nation.
Scammers posing as IRS agents have already stolen over $1 million from thousands of innocent taxpayers in what is being called the largest tax-related phone scam ever seen.
According to J. Russell George, the Treasury Inspector General for Tax Administration, more than 20,000 taxpayers have been targeted by fraudulent IRS agents.
“This is the largest scam of its kind that we have ever seen,” George said in a news release. “The increasing number of people receiving these unsolicited calls from individuals who fraudulently claim to represent the IRS is alarming.”
Here’s how it works: The scammers call a taxpayer. They tell their targeted victims that they owe a tax payment and demand that they pay for it immediately using a prepaid debit card or wire transfer. To threaten them even more, the scammers tell their victims they could be arrested, lose their driver’s license, lose their small business, or be deported if they do not comply with these demands.
While the scheme is phone-based, many of the targeted taxpayers have been initially receiving fraudulent notices in the mail that claim to be from the IRS. Real agents are not allowed to demand payment by prepaid debit card or wire transfer like the thieves are doing, and they never ask taxpayers to provide credit card numbers by phone.
The information on the recent scam was revealed in a news release that is part of an ongoing awareness campaign conducted by the Treasury Inspector General’s tax arm.
Similar scams have been on the rise over the past year. In fact, the Inspector General’s agency said victims in all 50 U.S. states have been a target. However, there have been more immigrants who have reported receiving these types of calls. In the past, thieves have reportedly used fake identification information that appears on a caller ID so it looks like they’re calling directly from the IRS. Many of them know the last four digits of a taxpayer’s Social Security Number before calling, which gives them an additional key to obtain more personal information. In addition, they use common names, fraudulent badge ID numbers, and follow up their phone calls by sending e-mails that appear to be real (such as a message coming from an “@irs.gov” domain name).
Investigators at the Inspector General’s office are working with major U.S. phone companies to determine where the scammers are calling from and how they are carrying out these schemes.
To avoid tax fraud scams like this one and others, check out the IRS “dirty dozen” list of current tax fraud scams to be aware of and steps you can take to avoid them during the 2014 tax season and beyond. 1-800Accountant can also help you protect yourself, your family, and your small business from potential problems. Learn more by calling 1-888-749-01171-888-749-0117 or by visiting www.1-800Accountant. 1-800Accountant can work with the IRS on your behalf to ensure you fulfill your tax obligations and remain protected.