In the scam, callers posing as IRS representatives advise potential victims that two certified letters were sent to the taxpayer in the mail but were returned as undeliverable. The callers then threaten to arrest the potential victim if a payment is not immediately made through a prepaid debit card. The scammer also tells the victim that the purchase of the card is linked to the Electronic Federal Tax Payment System (EFTPS) system: it is not.
To ensure that the potential victim doesn’t back out, the caller warns the taxpayer not to contact their tax preparer, an attorney or their local IRS office until after the tax payment is made. This should be a red flag. You should always have the opportunity to contact your tax professional before resolving a tax dispute. Additionally, if you’re not sure that you owe taxes, you always have the opportunity to hang up and call the IRS directly (1.800.829.1040) for more information. Don’t be pressured into making a spur of the moment payment.
The scammers are hoping that you’ll recognize the EFTPS: it’s a real government system used for paying your federal taxes electronically. Paying taxes through EFTPS is free through the U.S. Department of Treasury and does not require the purchase of a prepaid debit card, so don’t be fooled. Also, the EFTPS is an automated system, which means that you won’t receive a phone call from the IRS. It’s one of a number of ways that you can pay what you owe.
IRS Commissioner John Koskinen said about the latest scam, “This is a new twist to an old scam. Just because tax season is over, scams and schemes do not take the summer off. People should stay vigilant against IRS impersonation scams. People should remember that the first contact they receive from IRS will not be through a random, threatening phone call.”
As a reminder, the IRS will NEVER:
- Call to demand immediate payment over the phone, nor will the agency call about taxes owed without first having mailed you a bill (this is true even with the use of private debt collectors).
- Threaten to immediately bring in local police or other law-enforcement groups to have you arrested for not paying.
- Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.
- Require you to use a specific payment method for your taxes, such as a prepaid debit card, gift card or wire transfer.
- Ask for credit or debit card numbers over the phone.
Don’t engage or respond with scammers. Here’s what to do if you receive a suspicious phone call or message:
- If you receive a call from someone claiming to be from the IRS, and you do not owe tax, or if you are immediately aware that it’s a scam, don’t engage with the scammer and do not give out any information. Just hang up.
- If you receive a telephone message from someone claiming to be from the IRS, and you do not owe tax, or if you are immediately aware that it’s a scam, don’t call them back.
- If you receive a phone call from someone claiming to be with the IRS, and you owe tax or think you may owe tax, do not give out any information. Call the IRS back at 1.800.829.1040 to find out more information.
- You can also contact TIGTA to report scam calls by calling 1.800.366.4484 or by using the “IRS Impersonation Scam Reporting” form on their website. You may also want to report the scam to the Federal Trade Commission by using the “FTC Complaint Assistant” to report persons pretending to be from the government; please add “IRS Telephone Scam” in the notes.
I can tell you that every month we have at least a client or two call us in severe distress regarding a demand phone call they received from the “IRS”. The main takeaway point is that the IRS will NEVER call you. Don’t fall for the tricks. Keep your personal information safe by remaining alert!