How to Identify an IRS Scam

Posted on Feb 18, 2020

Every year, Clark Nuber receives numerous e-mails and calls from clients who report that someone from the IRS is demanding money right away for past due amounts. These demands are generally followed by a threat of arrest, lawsuit, deportation, or other acts of intimidation.

These communications are IRS scams.

What are IRS Scams?

IRS scams are usually made via phone call, voicemail, e-mails, or even text messages. These scam perpetrators impersonate IRS agents and will have information on your personal details, including your name, address, and telephone numbers. The scammers will also provide you with a fake IRS badge number to convince you of their legitimacy. These calls are happening more frequently and you, as a taxpayer, should be aware of these scams and how to spot them.

According to the Treasury Inspector General for Tax Administration (TIGTA), more than 1.8 million people have reported IRS impersonation calls. As of September 2019, more than 15,000 scam victims have lost upwards of $79.7 million to scams. The top five states with losses are California, New York, Texas, Illinois, and Florida.

Characteristics of IRS Scams

Here are some tips to look for in case a scammer contacts you. The IRS will never:

  • Call you without first contacting you via regular mail.
    • The IRS also does not leave pre-recorded, urgent, or threatening messages.
    • Scammers may also fake or “spoof” caller ID numbers that appear to be from the IRS office, sheriff offices, or even other federal agency offices in an attempt to prove the call is legitimate.
  • Demand immediate payment of the taxes due without giving you the opportunity to question and/or appeal the amount due. They will also never ask you to make a payment to a person or organization other than the U.S. Treasury.
  • Require you to use a specific payment method, which can include prepaid debit cards, iTunes cards, Amazon gift cards, or wire transfers. The IRS will also never ask for a credit or debit card number over the phone.
  • Threaten you with a lawsuit, arrest, and/or deportation.
  • Use unsolicited e-mail, text messages, or any social media to discuss personal tax issues.

If you receive an e-mail that is supposedly from the IRS, do not click on links in the e-mail or open any attachments. You can verify if you have an outstanding notice by calling the IRS at 1-800-829-1040. If you need to pay the IRS via a bank account, credit card, or debit card, go directly to their website to make a payment.

If you believe that you are on the phone with an IRS impersonator, hang up immediately. If you’re unsure whether you have any outstanding notices or payments due to the IRS, you should either call your CPA or call the IRS at 1-800-829-1040.

You can report scams/impersonations to the TIGTA via their website or their email: phishing@irs.gov. The IRS’ website also has a dedicated page regarding tax scams.

Tax season is now upon us, and these scams will only increase in frequency. Be vigilant, and if you have any questions please reach out to your Clark Nuber advisor.

Paul Ung, Tax Manager at Clark Nuber PS

Paul Ung is a manager in the Tax Services Group, serving high net worth individuals.

© Clark Nuber PS, 2020. All Rights Reserved

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This article or blog contains general information only and should not be construed as accounting, business, financial, investment, legal, tax, or other professional advice or services. Before making any decision or taking any action, you should engage a qualified professional advisor.

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