Hundreds of millions in unclaimed tax refunds are a week away from expiring because the people who are owed them haven’t filed, but that won’t stop identity thieves from trying to get a piece of it.
“The big thing that we’re seeing this year and the last three years is identity theft morphing into return fraud,” IRS agent Brian Watson told Zachary Ziegler for Arizona Public Media in a recent interview. “Basically tax returns being prepared by criminals with other people’s information.”
Many value investors have given up on their strategy over the last 15 years amid concerns that value investing no longer worked. However, some made small adjustments to their strategy but remained value investors to the core. Now all of the value investors who held fast to their investment philosophy are being rewarded as value Read More
If you’re getting someone to help you with your taxes, you should do a little research to make sure that the business and credentials are legitimate, but the type of return fraud that Watson is talking about is more likely the result of phishing for people’s details and then filing on their behalf.
Refund fraud is like ‘Nigerian scams’
“It’s sad when you find out about this stuff,” said Watson. “It’s like people who fall for those Nigerian scams; [the scammers] don’t have to get everybody, they just have to get lucky every now and then.”
If you’ve ever wondered why the so-called Nigerian scams use such preposterous claims to reel people in, it’s simply to weed out anyone who has enough sense not to turn money over to strangers (or who isn’t in desperate enough to ignore their better judgment). This approach casts a wide net, but the first step is automatic, and only people who are willing to suspend disbelief get attention from the actual con artists.
IRS says to call police if you suspect a problem
The con artists filing fake returns aren’t necessarily the same people phishing for personal details – they might simply buy that information from someone else and then file claims on behalf of as many people as possible. When there are multiple filings for one person of course the IRS will know there is a problem, but if the actual person doesn’t file or files too late, then the con artist will collect. Again, the idea is to cast a wide net and rely on at least a few people not being conscientious (in this case by not filing).
Since the IRS is listing this as one of the main tax-related crimes they face, hopefully the procedures for catching identity theft are being streamlined. In the meantime, Watson recommends that anyone who discovers tax returns have been filed by someone else in their name contact their local police to start sorting things out.