Each year, while in the midst of tax season, taxpayers in North Carolina are warned to be wary of criminals posing as tax agents that carry out different scams. However, with every tax season comes increasingly sophisticated tax schemes, resulting in more and more reports of tax scams each year. In fact, according to a report from the IRS, thousands of people have lost millions of dollars at the hands of tax scams.
Dealing with tax preparation is already stressful enough without having to worry about costly scams, which is why our Raleigh CPAs at Steward Ingram & Cooper are here to help you avoid tax fraud and identity theft, along with preparing your taxes. So, here are some helpful tips on how to identify and prevent a tax scam.
Tell-Tale Indicators of a Tax Scam
An incredibly useful tool in avoiding tax fraud or identity theft is simply knowing what actions the North Carolina Department of Revenue (NCDOR) and the IRS will not carry out when it comes to pursuing taxes that are past due. Both entities will never…
- Visit a taxpayer in person unless they have first attempted to contact them via the United States Postal Service.
- Demand that a taxpayer use a specific payment method unless the taxpayer owes debt that is past-due. Otherwise, taxpayers are given the option of several different payment options, and may subsequently choose the one that is most ideal for them.
- Contact a taxpayer via text message, email, or social media and demand immediate payment.
- Require a taxpayer to pay their taxes without first providing the option to question or appeal the amount owed.
If you experience any of the previous occurrences, it is very likely that you are facing a tax scam. Unlike most forms of communication today, the NCDOR and IRS are not exactly the most modern, which is why you should be extremely skeptical of anything, other than letters from both institutions, that are demanding tax money.
How the NCDOR and IRS Contacts Taxpayers
As mentioned before, the NCDOR and IRS rarely initiate contact other than via letters. The only time these agencies do initiate contact is typically when a tax liability is being collected, when a taxpayer is being audited, or when a taxpayer is being criminally charged.
If overdue taxes are being collected, collection personnel will either call the taxpayer or visit their home or business unannounced (after first notifying them via mail). The NCDOR or IRS personnel will be able to provide credentials which validate their employment with the agency. More information about this collection process can be found here.
If a taxpayer is being audited, auditors will typically call the taxpayer to schedule an appointment. Once an appointment is scheduled, the auditors will then visit the taxpayer to discuss an ongoing audit. However, before the visit occurs, the taxpayer will receive an audit confirmation letter.
If a taxpayer is being criminally charged, Revenue Law Enforcement agents are given the right to appear at the taxpayer’s home or business unannounced while they are conducting the investigation. These investigators are responsible for dealing with serious, criminal tax violations and carrying out the prosecution of tax fraud.
What to Do if You Receive a Tax Scam
If you receive a tax scam email, or even suspect it is fraudulent, immediately forward it to email@example.com. Afterwards, report this scam to the Treasury Inspector General for Tax Administration. If you receive a phone call from an individual claiming to be the IRS, do not return the phone call whatsoever and block this number. If you need clarification that the phone call was not from the IRS, call the IRS directly at (800) 829-1040 or the Raleigh IRS Office at (919) 850-1100.
If you have been victimized by tax fraud, follow these helpful guidelines by the IRS.
Need Assistance With Your Tax Return?
While being on the lookout for tax scams is always important, it’s also important to get your taxes done as effectively as possible! Our dedicated Raleigh CPAs at Steward Ingram & Cooper have extensive experience in assisting both individuals and businesses alike in successfully and effectively preparing their tax returns, and we would be more than happy to do the same for you. Schedule a consultation with our tax experts today to see how we can help you.