Tax-Related identity theft: What to look for and how to stay safe

The IRS continues to warn people of identity theft scams, especially regarding your personal financial and tax information. With these types of theft cases continuing to rise every year, it’s crucial to stay up to date on the latest forms of identity theft and how to keep your information private and safe. Let’s dive into the different scams out there and how you can spot them:

Phishing scams:

There are several ways phishing scams can affect people. This includes strange text messages, emails, websites, and more. These scams are intended to obtain your personal or financial information including but not limited to credit card numbers, home addresses, bank account information, etc. Some phishing scams look very similar to legitimate correspondence you would get from a credit card company or bank, therefore making it easier to fall for the scam and become vulnerable.

The IRS has even reported a large increase in scams using Electronic Filing Identification Numbers (EFIN) and Centralized Authorization File (CAF) numbers. Some of these emails are heavily disguised to look like they are actually from the IRS, but they are not real. Don’t ever open any links or attachments in these emails. If you think you’ve received an email similar to this, you can report it here: https://www.treasury.gov/tigta/contact_report.shtml

Vishing:

Vishing or voice-related phishing seems to still be thriving even with the rise in texting. Most of these phone calls are from random numbers with a voice (sometimes automated) asking for personal or financial information. This could be anything from car warranty notices to someone wanting your tax or even medical information. Cybersecurity experts recommend hanging up the phone call immediately and not answering any personal questions.

In 2020, close to 400 vishing scams were reported which is a 14% increase from 2019. Out of those 400 scams, 25% were related to fake tax information which can be very dangerous especially around tax season. Keep in mind if the IRS is trying to reach you for any reason, it will most likely be by mail and additionally, they will never request any information from you on voicemails, via text messages, or emails.

Social media scams:

Since COVID-19 swept the nation, social media scams have run rampant on the internet in a variety of ways. This includes private messages on social media including suspicious links or messages to extract financial compensation or private personal information. A great way to avoid this is to make sure you have no specific personal information listed on your social media profiles. This includes personal email accounts, addresses, full names, etc. Making your accounts private is the best way to keep these scams from reaching you. Again, if your bank or credit card company is actually trying to contact you it won’t be done through a Facebook or Instagram message.

Ransomware attacks:

Ransomware is a form of software intended to block access to a certain computer system. This is done by encrypting data on IT systems in order to obtain ransom money from the victim so they can regain access to their system. Ransomware can become very dangerous very fast, which is why it’s essential to always have proper virus protection on all of your electronic devices. Larger companies can often be victims of this type of cyber attack leaving them an even bigger mess to deal with. The IRS continues to recommend staying up to date on the latest ransomware tactics and always report anything you experience that’s fraud-related immediately.

Unfortunately, identity theft scams aren’t going anywhere so don’t forget to always keep your personal information private and secure and report any scams that come your way. If you’re looking for more information on keeping your financial information secure, reach out to our team of experts. We offer a variety of financial consulting services. Looking to connect with us virtually? Book a consultation today!