Washington, DC – With deadlines for filing District and federal income taxes approaching, Attorney General Karl A. Racine today cautioned District residents to be on the lookout for fraudulent schemes common during tax season. In particular, he singled out “Six Scams to Avoid” for the 2016 tax season.

“At the Office of the Attorney General, we work hard every day to protect consumers from those who want to defraud District residents of their hard-earned dollars,” Attorney General Racine said. “Some con artists use tax-filing season, when millions of Americans are sharing important financial information via the mail and online, to take advantage of consumers. That’s why we have identified below some of the most common fraud schemes that crop up during tax season.”

Attorney General Racine continued: “If you believe you have been a victim of any of these, I urge you to call our Consumer Protection Hotline at (202) 442-9828 or send an e-mail to consumer.protection@dc.gov.”

Attorney General Racine’s “Six Scams to Avoid” for the 2016 Tax Season

1. Phone Fraud: Taxpayers may receive telephone calls – which can often be aggressive in tone and contain threats – from criminals posing as Internal Revenue Service (IRS) agents. The calls often threaten prosecution if the taxpayer does not immediately pay a fine, which can total thousands of dollars.  These callers also threaten arrest, deportation, the revocation of licenses, and other negative consequences as a result of purported tax debts. In most cases, if a taxpayer owes back taxes, the IRS does not first contact the taxpayer by phone; rather the IRS will usually first contact those who owe taxes via mail.  The IRS also does not demand immediate payment, cash payments, or ask for credit-card or debit-card numbers over the phone. If you think you owe federal taxes, call the IRS at 1-800-829-1040 to confirm. For more information, visit the IRS website here.
    
2. Phishing: Phishing is the practice of disguising fake emails or setting up fake websites as legitimate ones in an effort to steal personal information. The IRS generally does not first make contact with taxpayers through emails, text messages or social-media outlets. Consumers should not click on any links in electronic messages claiming to be from the IRS if the message arrived without warning. If you receive a suspicious email or other electronic message claiming to be from the IRS, report it to phishing@irs.gov. For more information, visit the IRS website here.
    
3. Identity Theft: Taxpayers should always be vigilant about identity theft, but particularly during tax season. Criminals sometimes file fraudulent returns using someone else’s Social Security number in order to claim their refunds. In the most recent three fiscal years, IRS investigators helped convict approximately 2,000 identity thieves. For more information, visit the IRS website here.
    
4. Return Preparer Fraud: While the vast majority of tax professionals provide honest tax-preparation services, some dishonest preparers set up shop during tax-filing season to perpetrate refund fraud – including identity theft and other schemes that defraud taxpayers. Return preparers are a vital part of the U.S. tax system. Legitimate preparers of federal returns should have an IRS Preparer Tax Identification Number (PTIN). Anyone with a valid 2016 PTIN is authorized to prepare federal tax returns. For more tips and information on avoiding this kind of tax-season fraud, visit the IRS website here.
    
5. 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. For more information on avoiding this kind of fraud, visit the IRS website here.
    
6. Fake Charities: Taxpayers should always be vigilant to avoid organizations masquerading as legitimate charities to attract donations from unsuspecting contributors, but particularly during tax season. Claiming donations to illegitimate charities on a tax refund can lead to serious negative consequences for taxpayers. Before donating to a new charity, take a few extra minutes to check whether it is legitimate. Be wary of charities with names very similar to well-known national organizations; some fake charities use names or websites that intentionally imitate those of legitimate groups. You can research a charity online at the Better Business Bureau’s Wise Giving Alliance - www.bbb.org/charity/. The IRS website also allows people to find legitimate, qualified charities to which donations may be tax-deductible at https://www.irs.gov/Charities-&-Non-Profits/Search-for-Charities.

If you believe you have been the victim of an IRS or Charity Scam, please call the Attorney General’s Office of Consumer Protection at (202) 442-9828.