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Beware of Tax Fraud Scams: Don’t Trust Inquiries on Tax Returns and Federal COVID-19 Payments

On March 23, 2020, the Department of Justice and the IRS issued important reminders to taxpayers on how scammers are using tax filings and economic impact payments from the federal government related to COVID-19.  As we previously reported, bad actors are engaging in schemes to steal personal information and money, particularly from vulnerable persons.  The federal government wants to prevent taxpayers from falling victim to criminals using the recently approved economic impact payments as an opportunity to commit a crime.

The federal government began depositing automatic COVID-19 economic impact payments into taxpayers’ accounts on April 11. For most Americans, transfers are received by a direct deposit into a bank account. For individuals without bank accounts, or retirees or others who traditionally receive tax refunds by paper check, they will receive checks for economic impact payments.

Confusion aids and abets scammers’ ploys.  They may try to get you to sign over your check to them as agents for handling it or tell you that you need to “verify” your personal identifying information to receive your money, then later use your PII to file false tax returns for false refunds or engage in other identity theft schemes.  Virtually anyone eligible to receive a COVID-19-related economic impact payment from the government is at risk.

Karl A. Stiften, Special Agent in Charge of the IRS-Criminal Investigation St. Louis Field Office warned, “The existence of a deadly national pandemic will not stop criminals seeking to capitalize on the fears and difficulties faced by the public as they try to line their own pockets by stealing your money or your personal information.”  He offered the following information and tips to spot a scam and understand how the COVID-19 related economic impact payments will be issued:

    • The IRS will only deposit your check into the direct deposit account you previously provided on your tax return (or, in the alternative, send you a paper check).
    • The IRS will not call and ask you to verify your payment details. Do not give out your bank account or any other account information - even if someone claims it's necessary to get your check. It's a scam.
    • If you receive a call, don't engage with scammers or thieves, even if you want to tell them that you know it's a scam or think that you can beat them. Just hang up.
    • If you receive texts or emails claiming that you can get your money faster by sending personal information or clicking on links, delete them. Don't click on any links in those emails or texts.
    • Reports are also swirling about bogus checks. If you receive a check that requires you to verify the check online or by calling a number, it’s a fraud.

The U.S. Attorneys’ offices are prioritizing investigations into these types of scams to protect taxpayers and the integrity of the tax system.  If you suspect you have been scammed or received questionable communications, report the incident on the Justice Department’s website, www.usdoj.gov, contact your local U.S. Attorneys’ office, or call the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721).  If you have questions regarding your taxes or relief payments, talk to a trusted attorney, CPA, or tax preparer, and secure official information solely through www.irs.gov.


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