Each year, the Internal Revenue Service releases a list of the 12 most popular tax scams for the year. The 2008 list is out, and I thought it would be fun to go through them individually to show you how criminals are trying to take advantage of taxpayers. The basic idea behind all of these scams is simple: prey on a taxpayer’s fear of the IRS or their desire to avoid paying taxes.
Use the information here to help avoid being taken advantage of by a scammer who wants your money. And use this basic rule of thumb for any offer or communication regarding taxes: If it sounds too good to be true, it probably is. Don’t get fooled by claims regarding mysterious refunds or tax bills. When in doubt contact the IRS directly for help with your situation.
No sooner had politicians announced the Economic Stimulus plan to send $300 or $600 checks to taxpayers, and scammers were already on the hunt to defraud you. Of course, there are those advertising business opportunity scams (including network marketing companies and multi-level marketing companies) who want you to use your check to “invest” in their pyramid schemes. Don’t do it!
But even more nefarious are the criminal preying on the ignorance of taxpayers to defraud them. Taxpayers aren’t real clear on how much they’re getting and what they have to do in order to get their checks. And that’s where the scammers come in. They’re trying to lure taxpayers into giving up personal information like bank account numbers and social security numbers, saying this information is necessary to receive your check.
Don’t believe them! The IRS is not operating this way! The only thing taxpayers need to do in order to collect their check (if they otherwise qualify) is file a 2007 tax return. Even if a taxpayer owes no taxes for 2007, a return must be filed in order to qualify for the tax rebate.