Before I get to today’s topic (some thoughtful guidance on spotting an IRS tax scam) let’s discuss this…
It’s that time of year when spending seems to really kick in. Yes, I know we’re still in September, but all of these holidays that seem to mysteriously demand extra time and money will be popping up rather soon (as the holiday shelves at our local Target are even now making us aware of).
We’re also nearing the end of the year and the extended personal return deadline (October 17th).
And we all know from experience how time just … slips … through … our fingers these final months. The best of intentions about Getting Things Done (hello David Allen) won’t matter if you procrastinate until the deadline is in your face.
So I want to suggest that we have a tax planning chat (or a “finish my taxes” chat before it’s too late):
Now, one thing that would be especially difficult if it happened this last part of the year – when you’ve budgeted for holiday gift giving and travel – is losing those funds to an IRS scam.
Here’s what you’ll want to know…
Top Hat Tax & Financial Services’s guide to Avioding an IRS Scammer
“We’ll try to cooperate fully with the IRS, because, as citizens, we feel a strong patriotic duty not to go to jail.” – Dave Barry
You’re minding your own business when the phone rings. You don’t recognize the number on Caller ID but you answer it – and immediately some grave voice tells you they’re from the IRS and you owe some serious back taxes. They threaten to have somebody at your door that afternoon unless you pay.
You’ve got an IRS scammer on the phone. Hang up and block the number.
But what if the IRS does try to contact you? Hanging up on them and blocking their number is not a good idea. How do you tell the real tax authorities from an IRS scammer?
As many as one in 10 Americans suffer from tax fraud – thousands of people have lost millions of dollars and mountains of personal info, even in our local San Diego area. Preferred media for this sleaze: regular mail, phone, email, text – if we still drew on the sides of caves, an IRS scammer would probably use that, too. The statistics more or less go up year after year, powered by all the newest personal tech.
Typically, crooks pretending to be from the Internal Revenue Service call or even send a letter claiming that you owe taxes and offering you convenient ways to pay, including debit card or wire transfer. “Arrest” is usually mentioned. Or you may get an email or text that requires you to verify your personal information (college students and staff were a recent popular target). The message often includes a handy hyperlink or button that will whisk to you a bogus form or website. (Do not click on it!)
The IRS recently got billions of dollars (courtesy of the Inflation Reduction Act) to pay for new enforcement efforts. We hope curtailing this garbage is high on their list.
The money’s also going toward getting more revenue officers (IRS agents) into the field, sometimes for scheduled audits and sometimes to drop in on tax delinquents who haven’t responded to repeated tries to contact them.
The real deal
When the IRS wants to get in touch, they almost always do so first and foremost through regular mail by the United States Postal Service. The IRS doesn’t phone, robocall, text, ping you on social media, or email first. Even if the IRS does call, they don’t threaten you with the cops, demand your bank account number, or order you to pony up PDQ using an iTunes card.
The IRS does sometimes send a revenue agent or officer to a home or business if a taxpayer has an overdue tax bill or a delinquent, unfiled tax return. IRS employees also show up to conduct in-person audits or investigate for a collection or criminal activity. These taxpayers have generally been doing something crooked for a while, and even they get several IRS letters beforehand.
(If you think you’re in trouble with Uncle Sam and you didn’t get any letters, think for a sec. Did you move and not tell the IRS or have your mail forwarded? Did you get IRS mail and never open it? Let us know immediately.)
IRS revenue officers carry two forms of identification: IRS-issued credentials, aka a “pocket commission”, and the government-wide standard HSPD-12 card. Both have serial numbers and photos of the employee; ask to see both IDs. In fact, if you do ask, they must also come up with still another piece of ID.
A revenue agent has to explain your tax debt to you and make clear how you can officially dispute it. (You’ve got some serious rights in a tax-debt situation, by the way.)
What to do if you think you’ve encountered an IRS scammer
If somebody calls you claiming to be the IRS, tell them zip, hang up, and then:
- If you owe federal taxes or think you might, call the IRS at (800) 829-1040. If you don’t owe taxes, fill out this form on the Treasury Inspector General for Tax Administration site.
- Report the call to the Federal Trade Commission. When reporting it, add “IRS Telephone Scam” to the comments in your complaint. If you see a toll-free number identified as the IRS on your caller ID, it’s what the FTC terms a spoofed call – don’t fall for it.
- You can also file a complaint with the Federal Communications Commission.
- Contact the IRS at [email protected] to report bogus email.
You can also get one of the new IRS Identity Protection PINs that keep some sleaze from filing a tax return using your Social Security number or your Individual Taxpayer Identification Number.
If somebody claiming to be the IRS (or the real IRS) shows up at your door, politely tell them you’ll talk to them after you’ve talked to us. And tell us immediately so we can help you with any of your tax problems and planning.
I don’t want any of my Southwest California friends or neighbors to fall prey to a scam. That’s why I am equipping you with this kind of knowledge so you can be vigilant and protect yourself and your wealth. Knowing and doing these things before you fall prey is a key prevention tool.
And you’ve got another tool in your pocket… the Top Hat Tax & Financial Services team.
Fighting for you,
Darryl A. Hale, EA, MBA, MST