As hundreds of thousands of qualified Californians prepare to file for the state’s Earned Income Tax Credit (CalEITC) for the first time since its implementation, federal and state agencies want to remind all citizens to be cautious of some of the most recent tax scams. The best way to stay safe this tax season is to be aware and ask questions.
Each year the Internal Revenue Service (IRS) issues a list of tax scams that have the potential to create problems for unsuspecting citizens. These can vary and many of them are very creative.
For example, one of the ways perpetrators manage to trick so many citizens is by pretending to represent the IRS. Everyone is encouraged to be cautious when viewing e-mails, receiving telephone calls or getting advice on tax issues for anyone claiming to represent the Internal Revenue Service (IRS). Remember, the IRS never makes unsolicited telephone calls nor does it send unsolicited emails to citizens.
Another scam to be aware of is identity theft. This occurs when someone uses your personal information without your permission. That information can include your name, social security number, etc. Stolen information can be used by thieves to file a tax return and claim a fraudulent refund. The IRS has established a special group dedicated to investigating these types of crimes. For more information on identity protection, including prevention, detection and victim assistance visit www.irs.gov/Individuals/Identity-Protection. Taxpayers who believe they are at risk of identity theft can call the IRS Special Identify Protection Unit at (800) 908-4490.
The IRS has noted an increase in telephone scams around the country. In these instances, callers pretend to be representatives of the IRS with one purpose in mind—to steal a victims’ money and/or identify. These scammers have a wide-range of tricks up their sleeves. Examples include everything from them telling unsuspecting targets they owe money to telling him/her they are entitled to a very large tax refund.
These callers may use fake names and IRS identification numbers. They may have access to the last four digits of a victim’s social security number. At times, callers can use technology that enables the appearance of a fake 800 number on caller id—giving the illusion the call is coming from the IRS; some even create back ground noise to give the impression the call is coming from a call center.
Some of these criminals have also sent an email in advance to help give the call an air of legitimacy. Recipients of such calls and/or emails should immediately file a report with the Treasury Inspector General for Tax Administration at (800) 366-4484.
Phishing is another tool used by a number of thieves. Phishing is when you receive unsolicited email and/or fake website information that looks legitimate, but is designed to trick victims into providing valuable personal and financial information. The information is subsequently used to facilitate identity and/or the theft of financial assets. If you receive such phishing notifications it is important to report it to email@example.com. For more information regarding how to protect yourself from phishing scams visit https://www.irs.gov/uac/Report-Phishing.
The IRS also reminds all tax filers to use reputable tax preparers to avoid fake preparers. Criminals who pose as tax preparers primarily target low-income individuals and the elderly who may rarely file income tax returns. These criminals may charge victims high fees for tax preparation and then file false returns in the victims’ names and collect the money. The victims subsequently never receive the returns they are promised.
Do not become a victim of tax preparer’s fraud. The IRS warns to use tax preparers willing to sign the returns they prepare. Make sure they also enter their IRS Preparer Tax Identification Numbers. You can find tips on how to choose a tax preparer at www.irs.gov/uac/Newsroom/IRS-Offers-Advice-on-How-to-Choose-a-Tax-Preparer.
CalEITC4Me encourages eligible Californians to file for California’s Earned Income Tax Credit and the Federal Earned Income Tax Credit for free with help from the Volunteer Income Tax Assistance (VITA) Program. To learn more about the CalEITC and/or to find a VITA location near you visit www.CalEITCMe.org.