ROCKFORD — Better Business Bureau is alerting taxpayers to the tricks con artists will use over the next several weeks to take your money, personal identity, and peace of mind. As the tax season picks up pace, scammers will capitalize on the pressure taxpayers are under. This year’s filing deadline is Monday, April 18. 

“Tax scammers are online and in-person,” says Dennis Horton, director of the Rockford Regional Office of the Better Business Bureau. “No matter how you get your taxes done, scammers are waiting in the wings. BBB developed a comprehensive guide to reducing your risk of tax fraud.” 

Tax Identity Theft Scams Tax identity theft occurs when a scammer uses your Social Security number to file a tax return in your name and collect your refund. Scammers steal tax information in several ways, such as a phishing scam, a phony tax preparation service, or a hack or data breach. 

Victims of tax identity theft typically don’t realize they’ve been targeted until they actually file their taxes or much later. It is then that they get a written notice from the IRS saying that more than one tax return was filed, or they were paid by an employer they don’t know. 

The best way to avoid tax ID theft is to file your taxes as early as possible before a scammer has the chance to steal your information and file a fake tax return. Obtain from the Internal Revenue Service (IRS) an Identity Protection PIN (IP PIN). This is a six-digit number, which confirms your identity in addition to your Social Security number. The IRS will provide your IP PIN online and then send you a new IP PIN each December by postal mail. Once you apply, you must provide the IP Pin each year when you file your federal tax returns. 

Email Phishing Scams

The emails appear to be from the IRS and include a link to a bogus website intended to mirror the official IRS website. These fraudulent emails direct you to “update your IRS e-file immediately.” The emails sometimes mention USA.gov and IRSgov (without a dot between “IRS” and “gov”). Don’t get scammed. These emails are not from the IRS.

IRS Impersonation Scams 

IRS Impersonation Scams most often start with a phone call and take two basic forms. In the first version, the IRS “agent” says you owe back taxes and pressures you into paying by prepaid debit card or wire transfer. The scammer threatens you with arrest and fines if you don’t comply. In the other version, scammers claim they are issuing tax refunds and ask you for personal information so they can send you your refund. The scammer may give a fake badge number and name. Your Caller ID may look like the call is coming from Washington, D.C. Con artists sometimes follow up scam calls with an email, which uses the IRS logo, colors, and official-sounding language. These scams start with a serious and official sounding “robocall” recording in many instances. Scammers usually try to push you into action before you have time to think. Scammers will insist that payment be made by wire transfer, prepaid debit card, or other non-traditional payment methods, which are mainly untraceable and non-reversible. In contrast, the IRS will give you the chance to ask questions or appeal what you owe. Also, the first IRS contact with you will always be by mail. The IRS does not initiate contact with taxpayers by email, text message, or social media to request personal or financial information. The IRS will never demand immediate payment, require a specific form of payment, or ask for credit card or debit card numbers over the phone. 

Ghost tax preparers 

“Black market” tax preparers set up shop around tax time, usually in a vacant storefront. They will often promise tax filers fast or large refunds. These “ghost tax preparers” are uncertified individuals who bypass checks and balances in the tax preparer certification system. Even more disturbing, the big refunds they promote are not calculated in legal ways. Be sure your tax preparer has an IRS-required PTIN, or a Preparer Tax Identification Number. But this system only works if tax preparers sign the returns they file. Fraudulent tax preparers don’t want to follow the process so they simply don’t sign the returns. Ghost preparers actually do prepare the tax return, but when it’s submitted to the IRS, these scammers ask the taxpayer to sign their own return, making it look like it was self-filed. This doesn’t seem like a big deal until something goes wrong and the preparer is nowhere to be found. 

Red flags to watch for: 

• Be wary of those offering fast refunds or large returns. What you owe is solely based on your past year’s tax information and the current tax laws. The time it will take to receive your refund depends entirely upon the IRS. 

• Review your tax return before it’s submitted to ensure it was signed properly by your tax preparer. 

• Only allow funds to be deposited into your personal accounts. Some ghost preparers will have funds deposited into their own accounts “to be later distributed.”

Contact the IRS immediately if you get: 

• a written notice from the IRS about a duplicate tax return 

• an IRS notice stating that you received wages from a company that you never worked for 

• Think about availability. If the IRS finds errors in your tax forms or decides to perform an audit, will your tax preparer be available to help you with the details? Find out whether you can contact the tax preparer all year long or only during tax season.