5 Ways to Avoid Tax Scams

Tax season is here, and with it comes an increased risk of falling victim to scammers. Each year, many taxpayers’ personal information is compromised through phishing scams or by unethical tax preparers. To help you avoid tax scams, consider following these tips.

Go to a Reputable Tax Preparer

On the surface, it may seem simple to find a tax preparer. But before you trust anyone, make sure the person is reputable. It’s best to go online and do some research. Look at their reviews and consider how long they have been in business before making your decision. This can help determine if they’re legitimate. For instance, if it’s an individual working from home who is unaffiliated with a larger accounting firm and there is little information about them online (or no reviews), that could raise red flags. To confirm the person is who they claim to be, you can ask for their IRS Preparer Tax Identification Number (PTIN). All paid preparers are required to have one. Your personal information is valuable, so don’t trust just anyone.

Avoid Any Preparers Who Guarantee You a Large Return Before Looking at Your Financials

This is another red flag. Until a preparer has looked at your documents and information, they have no idea what kind of return you’re going to receive, or even if you are going to receive a reimbursement. If someone is making promises before even seeing your filings, it’s best to choose a different preparer.

Beware of Anyone Who Requires a Portion of Your Return

Tax scam victims often report that once their returns were prepared, signed, and filed, the preparer then told them the filing was fraudulent and demanded victims hand over half of their return, or be turned over to authorities. This is a scam. No one should be threatening you. That’s why it’s important to verify your preparer’s credentials before having them file your taxes. In addition, you are providing this individual with your personal information, which could result in identity theft as well as a scam.

If Filing Yourself, Verify You’re on a Valid Website

It’s common to file online on your own, but before you start, use good judgment and do your research. Make sure you’re using a legitimate site, and never click on a link from an unsolicited email. The link could lead you to a masqueraded page which is not what it appears to be. Instead, only visit reputable websites by typing in the URL yourself, so you know you are working with a legitimate business.

Don’t Fall for Phone Scams

During this time of year, fraudsters are looking to prey on innocent people to steal their identities by pretending to be from the IRS. If you receive a phone call from someone claiming to be from the IRS, hang up and call the IRS directly if you have concerns. The IRS does not make unsolicited phone calls to taxpayers. They only communicate through mail. Don’t fall for this.

Keeping your money safe is as important to us as it is to you. PlainsCapital Bank’s Fraud Department provides educational resources for businesses and individuals to help detect and prevent fraud. For more information about our fraud prevention efforts, visit our fraud resources page. There you will find articles about the most recent scams and how you can avoid falling victim to one.