Over the past two years, there have been over eight million suspicious activity reports related to identity theft and income tax filing. This year will be no different. Scammers are only doubling down on their efforts to break into your accounts — and are getting more sophisticated in the ways they do it.
Tax scams are increasing at the same time fraud in general is on the rise. The only way to protect yourself from these scams is to be aware of what is out there and increase security around your finances.
According to the Federal Trade Commission, fraud cost consumers $10 billion in 2023, and that includes tax fraud. When it comes to tax filings, 92% of tax returns were filed electronically last year, making those returns even more vulnerable to hackers and AI.Â
Here are three ways scammers are trying to hack your accounts and how you can protect yourself:
1. If possible, file your taxes early — before someone tries to do it for you
If you aren’t aware of this scam, tax filing fraud is when scammers will file a return in your name and subsequently steal your refund. One way to steer clear of this scam is to file early and get your tax return into the IRS so no one can beat you to it. In addition to filing early, you can also get an identity protection PIN, which prevents someone else from filing a tax return using your Social Security number.Â
If you have already been a victim of tax-related theft, the IRS should be sending you a new IP PIN every year. However, the IRS has now opened up the process, allowing anyone with a Social Security number or individual taxpayer identification number who can verify their identity to enroll in the program by filling out an application online.
2. Be vigilant about scam phone calls, emails, and texts
This annoying way for a scammer to try to reach out and rob you has only increased over the years but gets taken up a notch during tax season. Phone scammers pose as IRS agents…
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