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Avoid Scams This Tax Season

Published February 7,2018

By Jordan Ottaway 

It’s that time of year again. Americans are gathering their W-2s and other documents needed to file their taxes with hopes of getting a nice little refund.

Unfortunately, with tax season comes the scammers hoping to swindle as many people as possible.

Here’s a list of popular scams and key factors you need to watch out for this tax season.

IRS Phone Scam 

You’ve probably received phone calls claiming to be from the IRS, FBI, or some other government agency, but something didn’t seem right. Yes, that would be because someone is trying to scam you.

To reiterate, the IRS is NEVER going to call you on the phone saying you owe money or threaten you with arrest. It’s only a scare tactic. Sadly, that doesn’t keep people from falling for it.

These scams are very dangerous because criminals use caller ID “spoofing” where they can make it seem like the call is coming from a local government office. If you ever get a call saying you owe money and are subject to arrest, just hang up. If you really did owe money, the IRS would send you a letter in the mail.

 neon sign that says income tax

Phishing Scams 

Phishing scams are another common scam that’s also become increasingly difficult to detect.

You’ve probably received an email or text message claiming to be from a trusted retailer or financial institution asking you to follow a link to update account information, shipping information, etc. This is a phishing scam.

This type of attack is where scammers pose as a legitimate company hoping to get your personal information over the internet. Even if you “know” the source and the message looks legitimate, never open suspicious links or messages because your information could be at risk. Take the smart route and delete the message.

If criminals get their hands on your information, they can use it to file false returns to claim bogus refunds.

Preparer Fraud

While many Americans file their own tax returns, there are still a large amount that seek guidance from a tax professional. In 2017, 92 percent (122,164,000) of tax returns were filed online. According to the IRS, roughly 60 percent of taxpayers use tax professionals to prepare returns.

The majority of tax professionals work to provide honest, high-quality service for their clients. However, there are some that pop up every tax season to only commit refund fraud and other scams that hurt taxpayers.

This is why you need to do your due diligence when choosing who to file with. Here are some tips:

  • Ask if they have an IRS Preparer Identification number (PTIN). Paid tax professionals are required to register with the IRS.
  • Check qualifications. The IRS has a IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications that can help locate a tax return preparer with the preferred qualifications
  • Check the preparer’s history.  Ask the Better Business Bureau about the preparer. Check for disciplinary actions and the license status for credentialed preparers. For CPAs, check with the State Board of Accountancy. For attorneys, check with the State Bar Association. For Enrolled Agents, go to and search for “verify enrolled agent status” or check the Directory.

Don’t let this scare you away from using a professional to file your taxes. We just want to give you information so you can ask the right questions. The IRS has published additional tips on what to look for when choosing a tax return preparer.

Payroll Scams

Criminals don’t only target individuals. Businesses are fair game as well.

The IRS has warned companies about a scam tricking the human resource department into giving up employee information and forms. Scammers send fake emails pretending to be an executive employee asking for W-2 forms and personal employee information.

Once they get this information, criminals can steal your identity and file fake returns. If you ever get an unusual request like this, verify with the employee it was sent from and delete the email immediately. If your employers aren’t aware of this scam, let them know and ask them to send an email to staff to make them aware.

It’s a good idea to always keep your information safe. Especially during tax season. If you ever receive a call, email, or text from anyone trying to access your information or scam you out of money, call the FTC and IRS immediately.

If you ever get a message requesting your social security number or account number claiming to be from Neighborhood Credit Union, please notify us and the NCUA. We will never request that information through an unsecure medium.

When it comes to your taxes, taking extra precautions is always worth it.

Headshot of Jordan Ottaway
Jordan Ottaway contributed to the Neighborhood Credit Union blog from 2016 - 2019.