There will always be those intent on earning money by tricking the hard-working out of their cash. Right now, the IRS is warning about two new scams that might impact you:
1. Typhoon Haiyan Relief
Recently, a massive typhoon devastated parts of the Philippines. As is the case when such disasters strike, efforts to collect money for charitable efforts immediately got underway. Unfortunately, these types of disasters also bring out the scammers.
Scammers promise that your donation is tax deductible and that it will go to relieve the suffering of the disaster-stricken. You offer a donation, thinking you’re helping out, and record it so that you can claim a tax deduction and reduce your tax liability.
Unfortunately, you find out later that the charity wasn’t legitimate. Not only are you out the money, but you might be penalized if the IRS finds out after you have completed your tax return. You might be asked to pay more in taxes later (since you owe more due to the illegitimate deduction), and you might even have to pay a penalty.
If you want to help with a disaster effort, go to the site of a well-known and legitimate charity. Most of these charities, such as the Red Cross, offer you the chance to specify that your donation go toward the disaster relief. If you go directly to the source, rather than trusting a solicitation over the phone, social media, or email, you know that your money is going to the right place, and that you are truly eligible for the tax deduction.
2. Phone Call Claiming You Owe Money to the IRS
Another recent scam is one that focuses on a phone call meant to scare you into paying money in order to discharge a fictional debt to the IRS. These phone scammers are quite sophisticated, according to the IRS. Some of them give you a “badge number.” Additionally, the caller I.D. might be “spoofed” to appear that the call is really coming from the IRS, when it isn’t.
The caller tells you that you owe money to the IRS, and that you will be penalized in some way if you don’t pay. Some even claim that you will go to jail — an action that isn’t usually taken by the IRS unless it is proved that you are actively avoiding paying taxes. You get scared and agree to pay, usually by credit card. The scammer gets the money, and you feel peace of mind, but you are out the money.
Before you respond to someone calling you and claiming to be from the IRS, remember that the IRS uses snail mail to provide you with an initial notice when you owe money. You won’t be called, and you won’t be sent an email if it is your first notice. Often, you won’t be notified by phone even if you have a long history of run-ins with the IRS. If you have a designated representative, the IRS will contact him or her.
If you are concerned about the situation, you can call the IRS directly, using the “official” number found on the IRS.gov web site. Don’t pay anyone claiming to be from the IRS with a credit card over the phone.