Day 3: Dirty Dozen Tax Scams of 2017

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Hey, that’s not me! Identity theft makes tax filing a mess. The IRS uses as many as 183 different filters on tax returns to help insure your tax return is being filed by you. In 2015 the IRS identified more than 1 million fraudulent returns and prevented more than 6.8 billion in fraudulent returns. The sad news is they don’t know how many made it through.

Identity Theft: Taxpayers need to watch out for identity theft especially around tax time. The IRS continues to aggressively pursue the criminals that file fraudulent returns using someone else’s Social Security number. Though the agency is making progress on this front, taxpayers still need to be extremely cautious and do everything they can to avoid being victimized.

The IRS says this is how taxpayers can help

· Always use security software with firewall and anti-virus protections. Make sure the security software is always turned on and can automatically update. Encrypt sensitive files such as tax records you store on your computer. Use strong passwords.

· Learn to recognize and avoid phishing emails, threatening calls and texts from thieves posing as legitimate organizations such as your bank, credit card company and even the IRS. Do not click on links or download attachments from unknown or suspicious emails.

· Protect your personal data. Don’t routinely carry your Social Security card, and make sure your tax records are secure. Treat your personal information like you do your cash; don’t leave it lying around.

Here's the full report from the IRS:

The Internal Revenue Service today issued a filing season alert warning taxpayers and tax professionals to watch out for identity theft at tax time and highlighted the crime as a top scam in the agency’s “Dirty Dozen” series.

The Dirty Dozen is compiled annually by the IRS and lists a variety of common scams taxpayers may encounter any time during the year. Many of these con games peak during filing season as people prepare their tax returns or hire tax professionals.

Tax-related Identity theft – with its related scams to steal personal and financial data from taxpayers or data held by tax professionals – remains a top item on the Dirty Dozen list because it remains an ongoing concern even though progress is being made.

The IRS, state tax agencies and the tax industry have joined as the Security Summit and enacted a series of safeguards that are showing results. In 2016, the number of taxpayers reporting stolen identities on federal tax returns fell by more than 50 percent, with nearly 275,000 fewer victims compared to a year ago.

To continue these efforts, the Security Summit partners applied more safeguards in 2017 and are continuing to seek new and expanded ways to reduce identity theft. Because of these successes, criminals are devising more creative ways to steal personal information to impersonate taxpayers.

“The Security Summit partnership continues to develop and strengthen tools to stop fraudulent returns from getting into the tax system," said IRS Commissioner John Koskinen. "We're calling on taxpayers to do everything they can to protect their private information because criminals continue looking for new and more sophisticated ways of beating the system. We also encourage tax professionals and others in the private and non-profit sectors with access to large amounts of sensitive information to watch out for identity theft schemes."

Security Reminders for Taxpayers The IRS and its partners remind taxpayers they can do their part to help in this effort. Taxpayers and tax professionals should:

Always use security software with firewall and anti-virus protections. Make sure the security software is always turned on and can automatically update. Encrypt sensitive files such as tax records stored on the computer. Use strong passwords.
Learn to recognize and avoid phishing emails, threatening phone calls and texts from thieves posing as legitimate organizations such as a bank, credit card company and government organizations, including the IRS. Do not click on links or download attachments from unknown or suspicious emails.
Protect personal data. Don’t routinely carry a Social Security card, and make sure tax records are secure. Treat personal information like cash; don’t leave it lying around.

"Everyone should guard their personal information by protecting their computers and using extreme caution when viewing emails or getting surprise phone calls," Koskinen said. "We also encourage people to share this information with their friends and family. We all know someone who is challenged by technology, and some easy, common-sense steps could help protect these people from identity theft."

The Security Summit launched a “Taxes. Security. Together.” public awareness campaign aimed at taxpayers. This campaign provided easy tips to taxpayers to better protect themselves, including video, tax tips and fact sheets to help taxpayers stay safe online. The Summit also initiated a “Protect Your Clients; Protect Yourself” campaign aimed at tax professionals who are increasingly being targeted by cybercriminals. This also includes a series of easy tips and alerts as schemes arise.

Tax-related identity theft occurs when someone uses a stolen Social Security number or Individual Taxpayer Identification Number (ITIN) to file a tax return claiming a fraudulent refund.

The IRS understands that undoing the damage caused by identity theft is a frustrating and complex process for victims. While identity thieves steal information from sources outside the tax system, the IRS is often the first to inform a victim that identity theft has occurred. The IRS is working hard to resolve identity theft cases as quickly as possible. For more information, see the special identity theft section on IRS.gov.