Karla Dennis, a tax professional with 25 years of experience and CEO of KDA Inc., discusses the IRS’s “dirty dozen” list of tax scams to be aware of each year. These scams include phishing, phone scams, identity theft, tax preparer fraud, and fake charities. She emphasizes the importance of protecting personal information and being cautious of any suspicious requests for information or payments, especially during tax season when scammers are more active.
Phishing scams involve emails that appear to be from the IRS but are actually from fraudulent sources trying to obtain personal information. Phone scams are where scammers pose as IRS agents demanding immediate payment with threats of jail time. Dennis warns taxpayers to hang up on such calls and not to disclose any personal information over the phone.
Identity theft is a prevalent issue during tax season, with scammers using stolen information to file false tax returns and claim refunds in the victim’s name. Dennis advises taxpayers to get an Identity Protection PIN from the IRS to prevent this type of scam. She stresses the importance of vigilance and caution when providing personal information to prevent falling victim to identity theft.
Tax preparer fraud involves individuals posing as legitimate tax preparers who may engage in fraudulent schemes to scam taxpayers. Fake charities also prey on unsuspecting individuals by soliciting donations for non-existent organizations. Dennis urges taxpayers to verify the legitimacy of charities before donating and to be cautious of promises of high tax refunds from unscrupulous tax preparers.
Dennis recounts a client’s experience with identity theft, emphasizing the far-reaching consequences of having personal information stolen. She provides tips for avoiding tax scams, such as obtaining an Identity Protection PIN, shredding documents with private information, avoiding giving out information over the phone, opting for direct deposit for refunds, and verifying a tax professional’s credentials. By staying informed and cautious, taxpayers can protect themselves from falling victim to tax-related scams and fraudulent activities.
