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MNCPA PERSPECTIVES

Scams run rampant during tax season

February 24, 2020  |  Corey Butler

Scams run rampant during tax season Don’t let a leg brace take you down.

Scam artists are getting more creative — and aggressive — by the day. One MNCPA member said a client received five calls from a person demanding her Social Security number and Medicare information so they could order a leg brace for her. The caller, forceful as can be, finally convinced the client that the request was legitimate.

It, of course, was not.

Naturally, there’s an uptick during the tax season because taxpayers are tracking and filing information they tend to stowaway the rest of the year. There’s also confusion about who may contact you and for what purposes. Unfortunately, the lack of knowledge can be a major hit against someone’s assets.

More than 3.2 million scams were reported to the Federal Trade Commission in 2019, which means a lot more actually occurred. Of those reported, the No. 1 scam was imposter scams, leading to $667 million lost to imposters. Next up were Social Security scammers, where the median individual loss was $1,500 from more than 166,000 scams reported.

While assertion is a powerful tactic among scammers, knowledge is the best defense against them.
The IRS and Minnesota Department of Revenue typically don’t contact you directly via phone or email for tax-related matters unless they’ve already sent a written notice by traditional mail. If you’re contacted by someone claiming to be with the government — or another entity — who is seeking personal information, ask for their credentials and request their phone number and say you’ll call back. Verify that number is legitimate and then call a direct number (not the one given to you) to see if there was an inquiry.

Of those scammed by phone, $1,000 was the median loss in 2019, according to the FTC. But not all scams are created equal nor executed by phone.

The MNCPA turned to its members to hear what scams they’ve come across recently in their work. Be on the lookout for these:
  • Calls purportedly about “canceling” your Social Security if you don’t respond with personal information.
  • IRS letters that look legitimate. Always scour these letters for legitimacy and cross reference the address and payee with information from IRS.gov.
  • Threats of arrest. This comes in many flavors, but it typically follows the pattern that a debt is owed immediately, and the only course of action is to purchase gift cards (usually iTunes or Amazon) and to share the card numbers with the scammer. People have lost thousands of dollars this way.
    • This largely comes by way of robocall and then someone will click onto the line if you answer.
  • New benefits to be shared by verifying your Social Security number. Again, do not share your Social Security number with anyone who contacts you.
  • Someone pretending to be with your tax return filer and wanting to verify information to process your tax return. Even if a phone call number looks legitimate, know that technology allows for scammers to “spoof” numbers of legitimate places, like a CPA firm or the IRS. Always reach out to your tax preparer independently to verify if they need additional information for your return.
Steps to avoid falling victim to tax-related scams
  • Scrutinize any email you receive, especially if it appears to be from the IRS, Department of Revenue or any other entity requesting your personal information. Again, you likely will not be contacted this way and a seal that looks official does not change that.
  • Don’t click links in emails from someone you don’t know and trust. Even if it is someone you know and trust, but the email seems suspect, independently verify that person sent the message. They could have been hacked and a scammer is leveraging your contact’s email list to benefit the scammer’s pockets.
  • Reminder: If you’re contacted by someone claiming to be with the government — or another entity — who is seeking personal information, ask for their credentials and request their phone number and say you’ll call back. Verify that number is legitimate and then call a direct number (not the one given to you) to see if there was an inquiry.
As one MNCPA member put it: "We live in a world where we have to stay extremely alert and nearly panic stricken to avoid scams."

However dire that may sound, it’s good advice to heed.

Topics: Clients, Taxation-Individual, Government, Technology

Corey Butler

Corey Butler is the MNCPA communications manager, working to enhance members’ professional reputations through content, media relations and public affairs. Corey keeps busy outside of the MNCPA spending time with his wife and children, serving on his local school board, volunteering in his community and catching up on long-lost hobbies. Corey enjoys the works of John Steinbeck and J.K. Rowling, and Paul Bunyan, Robin Hood and Santa Claus lore. You may reach him at 952-885-5530 or cbutler@mncpa.org.

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