IRS Reveals List of “Dirty Dozen” Tax Scams for 2020

Each year, the IRS publishes the “Dirty Dozen,” a list of tax scams most prevalent during Hands on computer in shadowsthat year’s tax season. This year, with COVID-19 pushing off the federal tax deadline to July 15, the IRS held off publishing the list until early July, and of course it’s loaded with COVID-19-related scams.

Whether you’ve filed for an extension, you’ve had your taxes filed for months or you’ve gotten them in just in time at the mid-July deadline, be on the lookout for the Dirty Dozen of 2020, which continues spreading for months after Tax Day.

1. Phishing: Fake emails or websites impersonate the IRS in an attempt to steal information about refunds or Economic Impact Payments (EIPs).

Protect yourself: The IRS will never initiate contact with taxpayers via email. Be extra wary of any websites and emails making heavy use of COVID-19 terms like stimulus, coronavirus and Economic Impact Payment.

2. Fake charities: Criminals exploit the fear and uncertainty surrounding the pandemic to set up bogus charities that rob innocent victims who believe they’re helping the unfortunate. The “charity” may even claim to be working on behalf of the IRS to help victims of the virus get their tax refunds.

Protect yourself: Charities with familiar-sounding names that aggressively market themselves are often bogus charities trying to make donors believe they represent the actual well-known organization. They will also refuse to provide an Employer Identification Number (EIN) when asked, and will not have a positive review on sites like Charity.org. Taxpayers can also search for legitimate charities using the IRS charity search tool.

3. Threatening impersonator phone calls: An alleged IRS agent threatens the victim with arrest, deportation or license revocation if taxes are not paid immediately by prepaid gift card or wire transfer.

Protect yourself: The IRS will never threaten a taxpayer or demand immediate payment over the phone. It also will not insist on being paid via gift card or wire transfer.

4. Social media scams: Scammers use information that can be found on social media platforms for a variety of scams, including the impersonation of the victim’s friend to get at the victims’ more private information. This ruse often ends in tax-related identity theft.

Protect yourself: The victim’s “friend” will claim to be in a compromised position and to urgently need the victim’s personal information. When contacted privately, though, the “friend” will have no knowledge of the interaction.

5. EIP or refund theft: Scammers steal taxpayers’ identities, file false tax returns in their names and pocket their refunds and their EIPs.

Protect yourself: Personal information should never be shared online with an unverified contact, even if the contact promises to assist in tax filing or receiving the EIP.

6. Senior fraud: Scammers, or long-term caregivers of the elderly, file tax returns on their behalf and then pocket the refunds and EIPs.

Protect yourself: Seniors should be wary of bogus emails, text messages and fake websites asking them to share their personal information.

7. Scams targeting non-English speakers: Scammers impersonate IRS agents and target non-English speakers, threatening jail time, deportation or revocation of the victim’s driver’s license if an immediate tax payment is not made. The victims have limited access to information and often fall for these scams.

Protect yourself: The IRS will not threaten taxpayers over the phone or insist upon immediate payment.

8. Unscrupulous return preparers: Alleged tax preparers will reach out to the victim and offer their services. Unfortunately, though, they will steal the victim’s personal information, file a tax return on their behalf and pocket the refund, or promise inflated refunds for a bigger fee.

Protect yourself: If a tax preparer is not willing to share their preparer Tax Identification Number (TIN), they are likely to be a scammer. Also, if the alleged preparer promises credits and deductions that sound too good to be true, they probably are.

9. Offer in Compromise scams: Bogus tax debt resolution companies make false claims about settling tax debts for “pennies on the dollar” through an Offer in Compromise (OIC) in exchange for a steep fee.

Protect yourself: An OIC that sounds outrageously attractive is likely bogus. Taxpayers can use the IRS’s OIC tool to see if they qualify for an authentic offer.

10. Fake payments with repayment demands: A scammer steals a taxpayer’s personal information, files a fake tax return on their behalf and has the refund deposited into the taxpayer’s checking account. The scammer then calls the victim impersonating the IRS and claiming the refund was mistakenly inflated, so the victim must return the extra funds via gift card or wire transfer. Of course, this money will go directly into the scammer’s pockets.

Protect yourself: Refund checks will never be deposited in a taxpayer’s account if they have not filed taxes. Also, the IRS does not demand payment by a specific method.

11. Payroll and HR scams: Scams target tax professionals, employers and taxpayers to steal W-2s and other tax information. They will then impersonate the employee and request to change their direct deposit information for their paychecks.

Protect yourself: If an employer or HR representative receives a request for a direct deposit change, it’s best to check with the employee directly to see if the request is legitimate.

12. Ransomware: Malware infects a victim’s computer, network or server, and tracks keystrokes and/or other computer activity. Sensitive data is then encrypted and locked. When the victim tries to access their data, they’ll receive a pop-up message demanding a ransom payment for the return of their information.

Protect yourself: Links embedded in emails from unverified sources should never be opened. Tax software should not be downloaded unless it features multi-factor authentication.

Don’t be a victim of the dirty dozen! Stay alert and stay safe.

Your Turn: Have you been victimized by a tax scam? Tell us about it in the comments.

Sources:
https://www.irs.gov/newsroom/irs-unveils-dirty-dozen-list-of-tax-scams-for-2020-americans-urged-to-be-vigilant-to-these-threats-during-the-pandemic-and-its-aftermath
https://abcnews4.com/news/local/irs-reveals-dirty-dozen-list-of-tax-scams-for-2020

Watch Out for These Scams as the Country Moves Toward Reopening

Woman in Mask Using Laptop.

As the coronavirus continues spreading across the country in waves and peaks, every state is making bold moves toward reopening under a strange new set of circumstances dubbed the “New Normal.” Face coverings are de rigueur. Floor markings have been slapped down exactly 6 feet apart near checkout counters in retail stores. Shoppers are weary, cautious and careful. And, as the country moves forward and adapts to the new realities, scammers aren’t far behind.

Watch out for these trending scams as the country reopens:

Account Takeovers

Even as retailers work toward reopening, shorter hours and percentage-capacity rules mean many consumers are still shopping remotely. Retailers are also busier than ever now as they comply with new rules and work to meet customers’ changing demands. This leads to an increase in online retail scams, like account takeovers, in which scammers hack a company’s database and break into a customer’s account. Using the customer’s remembered payment information, the scammer goes on to place large orders to their own address — all on the client’s dime.

Protect yourself:

Account takeovers are most commonly pulled off on dormant accounts. The scammer assumes these accountholders won’t notice this activity, but you can outsmart them by checking your retail accounts for sudden orders or deleting the remembered information from accounts you rarely use.

Business owners can spot these scams by looking out for sudden large orders from customers who haven’t purchased anything in months, or even years.

Job Scams

“Help Wanted” signs and ads are a welcome sight for the more than 40 million workers who have filed for unemployment since the pandemic hit American shores. Unfortunately, though, the flood of unemployed people looking for work has led to a rise in job scams. The FBI is warning against a surge in scams where cybercriminals pose as employers by spoofing websites and posting bogus job openings on online job boards. They may even go as far as conducting interviews with applicants. The scammers ask for personal information, and sometimes demand payment, before the “application” can be processed. Of course, there is no job waiting for the applicant, their information is now in danger of being abused and they’ll never see that money again.

In a variation of this scam, “employees” are given work to do remotely, and then paid with an inflated paycheck. They’re told they had been overpaid and instructed to cash the check and reimburse the employer for the surplus funds via money order or prepaid debit card. The check will appear to clear, but in a few days, it will bounce and the victim will never be able to reclaim the lost funds.

Protect yourself:

Beware of outrageous job claims that promise big money for little work; they’re likely bogus. As always, never share sensitive information online with an unverified source. Don’t accept a job that overpays and asks you to refund the extra money; it’s likely a scam. Finally, before agreeing to an interview, research an alleged employer and company on the BBB website.

The Contact Tracer Scam

Many states have hired armies of contact tracers to track the movements of individuals who may have been exposed to COVID-19. The FTC is warning of a new ruse in which scammers impersonate a contact tracer and reach out to people via phone call or text message. They’ll ask for the victim’s personal information, including their Social Security number, claiming they need this information for their work as a contact tracer. Of course, they’ll use this information to pull off identity theft or hack the victim’s accounts. The scammer will sometimes ask the victim to click on an embedded link, which will grant them access to the victim’s phone.

Protect yourself:

Contact tracers will always identify themselves and the department where they work. If a contact tracer reaches out to you, you can easily determine their authenticity by researching this information. The tracer will also have a basic understanding of COVID-19 and how it spreads. Most importantly, they have no need for your Social Security number nor will they ask you to share it.

As the country moves into a new period of healing and recovery, scammers are doing all they can to continue disrupting daily life. Stay aware and stay safe!

Your Turn: Have you been targeted by a reopening scam? Tell us about it in the comments.

Sources:
https://www.news5cleveland.com/news/continuing-coverage/coronavirus/scammers-aim-to-target-small-businesses-during-reopening-efforts

https://www.idtheftcenter.org/consumers-should-watch-out-for-covid-19-reopening-job-scams/

https://camdencountypros.org/paying-attention-to-potential-scams-as-new-jersey-moves-toward-reopening

https://www.consumer.ftc.gov/blog/2020/05/covid-19-contact-tracing-text-message-scams

Beware of Coronaviris Scams

Scammers are notorious for capitalizing on fear, and the coronavirus outbreak is no man in a medical maskexception. Showing an appalling lack of the most basic morals, scammers have set up fake websites, bogus funding collections and more in an effort to trick the fearful and unsuspecting out of their money.

The World Health Organization (WHO) has published on its website a warning against email scams connected to the coronavirus. The agency claims it has received reports from around the world about phishing attempts mentioning coronavirus on an almost daily basis.

Closer to home, the Federal Trade Commission (FTC) is warning against a surge in coronavirus scams, which are being executed with surprising sophistication, so they may be difficult for even the keenest of eyes to spot.

The best weapons against these scams are awareness and education. When people know about circulating scams and how to identify them, they’re already several steps ahead of the scammers. Here’s what you need to know about coronavirus-related scams.

How the scams play out

There are several scams exploiting the fear and uncertainty surrounding the virus. Here are some of the most prevalent:

The fake funding scam

In this scam, victims receive bogus emails, text messages or social media posts asking them to donate money to a research team that is supposedly on the verge of developing a drug to treat COVID-19. Others claim they are nearing a vaccine for immunizing the population against the virus. There have also been ads circulating on the internet with similar requests. Unfortunately, nearly all of these are fakes, and any money donated to these “funds” will help line the scammers’ pockets.

The bogus health agency

There is so much conflicting information on the coronavirus that it’s really a no-brainer that scammers are exploiting the confusion. Scammers are sending out alerts appearing to be from the Centers for Disease Control and Prevention (CDC) or the WHO; however, they’re actually created by the scammers. These emails sport the logo of the agencies that allegedly sent them, and the URL is similar to those of the agencies as well. Some scammers will even invent their own “health agency,” such as “The Health Department,” taking care to evoke authenticity with bogus contact information and logos.

Victims who don’t know better will believe these missives are sent by legitimate agencies. While some of these emails and posts may actually provide useful information, they often also spread misinformation to promote fear-mongering, such as nonexistent local diagnoses of the virus. Even worse, they infect the victims’ computers with malware which is then used to scrape personal information off the infected devices.

The phony purchase order

Scammers are hacking the computer systems at medical treatment centers and obtaining information about outstanding orders for face masks and other supplies. The scammers then send the buyer a phony purchase order listing the requested supplies and asking for payment. The employee at the treatment center wires payment directly into the scammer’s account. Unfortunately, they’ll have to pay the bill again when contacted by the legitimate supplier.

Preventing scams

Basic preventative measures can keep scammers from making you their next target.

As always, it’s important to keep the anti-malware and antivirus software on your computer up to date, and to strengthen the security settings on all of your devices.

Practice responsible browsing when online. Never download an attachment from an unknown source or click on links embedded in an email or social media post from an unknown individual. Don’t share sensitive information online, either. If you’re unsure about a website’s authenticity, check the URL and look for the lock icon and the “s” after the “http” indicating the site is secure.

Finally, it’s a good idea to stay updated on the latest news about the coronavirus to avoid falling prey to misinformation. Check the actual CDC and WHO websites for the latest updates. You can donate funds toward research on these sites as well.

Spotting the scams

Scammers give themselves away when they ask for payment via specific means, including a wire transfer or prepaid gift card. Scams are also easily spotted by claims of urgency, such as “Act now!” Another giveaway is poor writing skills, including grammatical errors, awkward syntax and misspelled words. In the coronavirus scams, “Breaking information” alerts appearing to be from health agencies are another sign of a scam.

You can keep yourself safe from the coronavirus by practicing good hygiene habits and avoid coronavirus scams by practicing healthy internet usage. Keep yourself in the know about the latest developments.

At Destinations Credit Union, we will never e-mail or phone you asking for personal information.  If you call us, we will verify that you are who you say you are by asking questions.  If you get an e-mail and you are unsure if it is legitimate or not, don’t click!  Go directly to the website of the legit organization or call them.

Your Turn: Have you been targeted by a coronavirus scam? Tell us about it in the comments.