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Beware of IRS phone scams

When your phone rings, the last thing you expect is for the Internal Revenue Service (IRS) to be on the other end. They address themselves and automatically you tense up. Why would the IRS be calling you?

They’re claiming you owe them money and are insisting on immediate payment. They may have also alleged that certified letters were mailed and returned as undeliverable. But how could this be true? You’ve always paid your taxes and never once had an issue. Yet they are relentless with their payment demands and threatening jail time if you don’t comply.

What should you do?

Hang up the phone because you are being scammed. In June, the IRS issued a warning to taxpayers about a new phone scam linked to the Electronic Federal Tax Payment System (EFTPS).

How the scam works:

  1. Scammer poses as IRS representative, calls to inform you that you owe for unpaid taxes.
  2. Scammer threatens you with jail time unless immediate payment is submitted using a prepaid debit card.
  3. Scammer explains how the purchase of your prepaid card is linked directly to the EFTPS.

Important notes about the Electronic Federal Tax Payment System (EFTPS):

  • There is NO direct link from prepaid credit cards to the EFTPS
  • The EFTPS does NOT require you to purchase prepaid cards for submitting payment

Does the IRS actually call people?

Yes, there are special circumstances in which the IRS may contact you via telephone but it’s rare. Even then, their efforts to get in touch with you won’t begin with a phone call. Generally, the IRS will send several notices to you in the mail before attempting any other form of contact.

What red flags should you look out for?

Most taxpaying Americans have little or no knowledge of how the IRS operates. If you make the correct deductions and file/pay your taxes on time, there’s nothing that should warrant further communication. As a result, majority of people who become targeted by IRS scammers don’t realize always realize what’s happening. Avoid falling victim to this scam by learning to recognize the red flags listed below.

This IRS does not:

  • Ask you for credit card information over the phone
  • Demand instant payment without providing you the opportunity to appeal or question the amount owed
  • Threaten immediate arrest, license suspension or deportation for not paying
  • Accept payments in the form of gift cards or wire transfers

Where do you make payments if you do owe taxes?

If you do owe taxes, you will be directed to pay though the U.S. Department of Treasury.