We usually advise investors to ignore breaking news – at least with respect to their investment activities. But one hot release we urge you to heed early and often is the recently finalized Internal Revenue Service’s 2016 Dirty Dozen List of Tax Scams. We especially want to call attention to the three worst offenders: Identity Theft, Phone Scams and Phishing.
Holding the Line on Phone Scams
To avoid being a victim of a phone scam, remember this critical point:
The IRS will NEVER call you out of the blue and ask for private information or issue threats.
Also, there’s a new twist on this year’s scams. In the past, the phony phone calls have been threatening, alleging that you are being audited or you owe money. This year, fake “agents” also are calling and claiming they simply need to verify personal information you have included on your tax return. Don’t do it!
Reeling in Phishers
Just as phone scammers seek to extract personal information from you by phone, phishers seek to do the same by e-mail, on websites or via similar online forums. In particular, if someone e-mails you claiming to be from the IRS, rather than replying to the suspicious e-mail, we encourage you to contact the IRS directly, using their legitimate contact information.
Bottom line, when anyone contacts you in any way and unexpectedly asks you for personal information, (especially Social Security or credit card numbers), you are encouraged to set a world speed record on how fast you can hang up on the call or ignore the message. For bonus points when it involves a potential tax scam, report the contact to the IRS.
The Dirtiest of the Dirty Dozen: Identity Theft
The IRS identified Identity Theft as the number one scam this year, especially since last year’s known data breaches are still playing out. While some forms of identity theft are beyond your control, there are actually quite a few common-sense steps you can take to at least minimize the threat. In our next two blog posts, we will offer Five Pillars of Protection that you can lean on in your personal efforts to ward off identity theft. In the meantime, if you have specific questions we can address, please be in touch!