If you consider your finances and financial resources, I’d wager that the IRS doesn’t make your list of allies and enablers. However, last year, the nation’s tax collector opened 2,500 criminal investigations and identified $10 billion in tax fraud and financial crimes. The truth is that even while it collects our money, it also applies significant resources to protect us from getting scammed.
So, the IRS is there to help.
Still, those three letters inspire fear in many Americans, and criminals use that to their advantage. They prey on taxpayers by pretending to be the IRS – and by claiming refunds that rightfully belong to you and me and/or gaining access to our bank accounts.
It can happen to anyone. A couple of years ago, a family member submitted his tax return and was shocked when the IRS notified him they’d already received one. It took months to fix the mess the fraudulent return caused. I’ve also talked to a number of USAA members who’ve been caught up in these tax-season scams — with outcomes ranging from large headaches to much worse.
Here’s a five-step plan to keep your bank account safe and stay in good stead with the IRS and your financial institution:
- Safeguard your personal and account info. Don’t carry your Social Security number with you and lock it away at home. Be wary online, especially when using a public wi-fi connection, and shred all sensitive documents.
- Add an extra layer of security. Many banks and financial services providers allow you to add a rolling security code or text-generated notification to your phone. Those can protect you even if a criminal cracks your password.
- According to the IRS, COVID-19 and stimulus payments have resulted in an uptick in fraudulent text messages and emails. Ignore them. Like other financial institutions, the IRS will not call or email you about financial matters unsolicited. If you suspect it’s a scam, report phishing and online scams at https://www.irs.gov/privacy-disclosure/report-phishing.
- File early. If a fraudster files a tax return in your name, you’re in a much better position if the real submission is already in.
- Play it safe. Have questions about a call, letter or inquiry? Go to the source by calling the IRS at 800-829-1040. Don’t use a number provided by a third party. You can check this one at the IRS website.
When you call the IRS, you may be on hold for a few minutes, but consider this while you’re waiting: In addition to answering phone calls and processing tax returns, the IRS is busy protecting taxpayers from fraud.