April 12, 2011

7 Tax Season Security Tips

Beware of Tax Season Scams

Tax season is almost over, and unless you receive messages via carrier pigeon, you could be vulnerable to a tax scam. A recent Scripps Howard News Service investigation analyzed more than 1.4 million ID theft records from the U.S. Federal Trade Commission from 2005 through early 2010 and found that fraud complaints from stolen tax return-related identity theft jumped from 11,010 in 2005 to 33,774 in 2009, nearly 300 percent.

The IRS receives thousands of reports each year from taxpayers who receive suspicious emails, phone calls, faxes or notices claiming to be from the Internal Revenue Service. Many of these scams fraudulently use the Internal Revenue Service name or logo as a lure to make the communication more authentic and enticing. The goal of these scams – known as phishing – is to trick you into revealing personal and financial information. The scammers can then use that information – like your Social Security number, bank account or credit card numbers – to commit identity theft or steal your money.

Protect Yourself from Tax Season Scams with these Seven Security Tips:

1. The IRS is nosy, but not too nosy: The IRS doesn’t ask for detailed personal and financial information like PIN numbers, passwords or similar secret access information for credit card, bank or other financial accounts.

2. You Got Mail – But Not from the IRS: The IRS does not initiate taxpayer communications through e-mail and won’t send a message about your tax account. When the IRS does have a question about your return, the agency will use paper correspondence sent via the Post Office. If you understand that the IRS will not contact you by email to let you know that you have a larger refund, or that you owe more money, then you can avoid 99 percent of the tax scams out there. If you receive an e-mail from someone claiming to be the IRS or directing you to an IRS site:

• Do not reply to the message.
• Do not open any attachments. Attachments may contain malicious code that will infect your computer, and some Trojan viruses can hook into your browser when you go into your online banking and steal that information.
• Do not click on any links. If you clicked on links in a suspicious e-mail or phishing website and entered confidential information, visit the IRS website and enter the search term ‘identity theft’ for more information and resources to help.

3. There’s only one irs.gov: The address of the official IRS website is http://www.irs.gov. Do not be confused or misled by sites claiming to be the IRS but ending in .com, .net, .org or other designations instead of .gov. If you discover a website that claims to be the IRS but you suspect it is bogus, do not provide any personal information on the suspicious site and report it to the IRS.

4. Follow up on questionable calls: If you receive a phone call, fax or letter in the mail from an individual claiming to be from the IRS but you suspect they are not an IRS employee, contact the IRS at 1-800-829-1040 to determine if the IRS has a legitimate need to contact you. Report any bogus correspondence.

5. Save important surfing for home: It’s convenient to jump online in a library or hotel lobby, or connect using the free public Wi-Fi at your neighborhood Starbucks,  but don’t conduct sensitive business on those networks, especially if you do your own tax preparation via TurboTax or other similar programs. Shared networks are often targeted to publicly expose your data and traffic to interception and exploit.

6. Beware of Free: Be wary of free or shady tax preparers like this New York Accountant who was stealing his clients’ children’s socials to create false tax returns. Many free tax preparation services are legit, but be sure to check the preparer’s credentials with the National Association of Tax Professionals or the American Society of CPA’s, and use referrals and CPA firms that are available year round for added security.

7. Report a scam: If you do feel that you have become victim to a IRS Fraud Scam, email phishing@irs.gov or go to this link for more info: http://www.irs.gov/privacy/article/0,,id=186436,00.html

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