WASHINGTON – With this year’s April 17 deadline looming for filing District and federal income tax returns, Attorney General Karl A. Racine today cautioned District residents to be on the lookout for fraudulent schemes common during tax season. He also warned taxpayers that recent data breaches affecting tens of millions of consumers mean that fraudsters and their schemes have evolved – and consumers should be on the lookout.
“Because of the Equifax data breach and similar breaches over the past couple of years, scammers have enough information to pull off increasingly elaborate deceptions,” said Attorney General Racine. “We’ve taken note of warnings we’re getting from the Internal Revenue Service, and we’ve also offered District residents information and tools they can use to protect themselves.”
If you believe you have been a victim of one of the below tax-season scams, please call our Consumer Protection Hotline at (202) 442-9828 or send an e-mail to consumer.protection@dc.gov. You can also learn practical tips for protecting yourself from identity theft, phone scams, charity scams, and more by visiting our Office of Consumer Protection website at oag.dc.gov/ConsumerProtection.
IRS PIN Pilot Program Available to District Residents
One way taxpayers in the District can protect themselves is through the Internal Revenue Service (IRS) Identity Protection PIN program. The program, currently being piloted in the District, Florida and Georgia, gives consumers a second level of protection when proving their identity. The Identity Protection PIN Program is designed to prevent identity thieves from obtaining a fraudulent refund using a taxpayer’s stolen Social Security number.
Attorney General Racine’s “Six Scams to Avoid” for the 2018 Tax Season
Phone Fraud: This year, the IRS is warning of a new spin on an old tactic of aggressive and threatening phone calls made by criminals posing as IRS agents. Some taxpayers have lately found tax refunds mysteriously deposited to their accounts, only to receive a call from someone posing as an agent demanding the money be returned, alleging fraud. What really happened is that the caller used taxpayer information obtained through a data breach, including Social Security and bank account information, to file a false return. Whenever a caller claims to be from the IRS, remember that the IRS will usually first contact those who owe taxes via mail, not by phone or email. The IRS also does not demand immediate cash payments, gift card payments, or credit- or debit-card numbers over the phone. If you think you owe federal taxes, call the IRS at 1-800-829-1040 to confirm. Visit the IRS website for more information about phone fraud and the Treasury Department's scam report webpage to report suspected phone fraud.
Phishing: Phishing is the practice of using imposter emails or websites to steal personal information. This year, the IRS is warning against criminals who execute sometimes elaborate schemes to get a taxpayer to go to a fake website that harvests credit card information. The IRS has also seen an increase in phishing attacks targeting tax preparers. Consumers and preparers should not click on any links in unexpected electronic messages claiming to be from the IRS. If you receive a suspicious email or other electronic message claiming to be from the IRS, report it to phishing@irs.gov. Visit the IRS website for more information about phishing.
Identity Theft: Criminals sometimes file fraudulent returns using a stolen Social Security number in order to claim refunds. That is why the OAG and the IRS recommend filing tax returns as early as possible. Taxpayers should always be vigilant about identity theft, but particularly during tax season. Visit the Office of the Attorney General’s website or the IRS identity theft page for more information.
Return Preparer Fraud: A handful of dishonest preparers set up shop during tax-filing season to perpetrate refund fraud—including identity theft and other schemes that defraud taxpayers. Legitimate preparers of federal returns should have an IRS Preparer Tax Identification Number (PTIN). Anyone with a valid 2018 PTIN is authorized to prepare federal tax returns. Visit the IRS website for more information about return preparer fraud and to access a directory of federal tax return preparers near you.
Inflated Refund Claims: Taxpayers should be wary of any tax preparer who promises outlandishly large refunds. Taxpayers should also avoid any preparer who asks them to sign a blank return, promises a large refund before examining their tax records, or who charges fees based on a percentage of the refund. These kinds of fraudsters often attract victims using flyers, advertisements, phony storefronts, and word-of-mouth via community and religious groups. Visit the IRS website for more information about inflated refund claims.
Fake Charities: Taxpayers should be particularly vigilant during tax season to avoid fraudsters masquerading as legitimate charities. Be wary of solicitors with names very similar to well-known national organizations; some fake charities use names or websites that intentionally imitate those of legitimate groups. Before donating to a new charity, make sure it is legitimate. The Better Business Bureau’s Wise Giving Alliance and the IRS Exempt Organizations Select Check can help. Learn more about charity scams at the Office of the Attorney General website and at the IRS.