- Days left

Beware of Free Tax Preparation Scams

The latest tax scam offers free tax preparation ... and may steal your identity or infect your computerAs tax season heats up, there are several options available for free tax filing assistance for qualified taxpayers. Unfortunately, the numbers of taxpayers seeking free tax help have also created new opportunities for con artists and scammers.

This season, some taxpayers have reported offers of free tax assistance via email. The offers vary but generally ask you to provide certain information about yourself and/or your income in order to determine whether you qualify. The information requested is similar to the W-2 scam reported earlier by WalletPop.The requests for information or "offers" for assistance aren't always limited to the IRS. I recently received an email from a taxpayer who was surprised to receive an offer for free assistance from the Baltimore CASH Campaign. The taxpayer didn't request assistance, doesn't live in Baltimore (or Maryland, for that matter) and doesn't qualify for free assistance.

The Baltimore CASH Campaign is, in fact, real, and it does offer free tax assistance for qualifying families. However, it won't be soliciting you via email for appointments; rather, its website directs you to make an appointment by clicking online or calling the organization directly.

Similarly, the IRS does offer free tax assistance and may send you information about how to obtain tax assistance, assuming you've opted to receive updates via email. However, those updates aren't directed to individual taxpayers (think of them more like newsletters) and they will never ask you for financial information or personal details via email.

When you receive these kinds of emails, it's not always a question of mere phishing or identity theft. The emails may be from a spammer hoping to harvest addresses; when you reply to the sender to advise that there's been a mistake or to ask for further information, you're confirming that your email address is, in fact, valid. That makes it valuable to companies who sell email addresses to third parties. So, don't reply to the sender.

Even more dangerous, the emails may contain links with spyware, malware or viruses. In October, a scam email claiming to be from the IRS regarding EFTPS payments was actually part of a sophisticated effort to steal the data on your computer. Even though the links in the email appeared genuine (they did, in fact, eventually forward you to the EFTPS site), the links zipped their way through another site -- in the blink of an eye -- that installed spyware on your computer in order to intercept your online banking transaction data.

What's the best practice, then, to avoid tax scams?

If you receive emails from supporting organizations claiming to be affiliated with the IRS or offering you free tax advice, check out the organization. Don't reply with any personal, tax or financial information via email and don't open attachments or click on any links from organizations that you don't recognize. When in doubt, call the organization for more information before you take any action.

Finally, remember, the IRS will never initiate contact with you by email. If you get an email claiming to be from the IRS, don't reply. Don't open any of the attachments or click on any links. If you'd like the IRS to investigate it further, you can forward the e-mail to phishing@irs.gov. Then, you should simply delete it.

Learn about investing from the comfort of your own home.

Portfolio Basics

Take the first steps to building your portfolio.

View Course »

Investment Strategies

Learn the strategies you need to build a winning portfolio

View Course »

TurboTax Articles

5 Tax Tips for Single Parents

Filing taxes as a single parent requires coordination between you and your ex-spouse or partner. Usually the custodial parent claims the child as a dependent, but there are exceptions. A single parent is allowed to claim applicable deductions and exemptions for each qualifying child. Even though you claim your child as a dependent, she may still have to file her own tax return if she has income, such as from an after-school job.

Affordable Care Act Decoded

The health care reform law known as the Affordable Care Act may directly affect your tax liability. Many taxpayers are familiar with the requirement that most Americans either carry health insurance or pay a tax penalty. But that's just one provision, and knowing what else is in the law can help you avoid surprises come tax time.

Cost of Taking the Wrong Tax Deductions

Taking the wrong tax deductions can cost you time and money. If you're depending on a tax refund, a tax return that is improperly filed can keep you waiting for a long time. You may also get back less than you expected. If the Internal Revenue Service suspects errors or requires proof of deductions, you may be asked to provide back-up documents to prove your numbers and amend the return. "If the IRS requires further information," advises Bill Symons, president of Computer Accounting Services in Oswego, N.Y., "You'll receive an official request by mail. Normally the situation is easily rectified, but it can delay refunds by up to 10 to 11 months."

5 Steps to Navigate the Healthcare Marketplaces

To navigate the Health Insurance Marketplace, you have to know what you want from a health plan. Have your previous plan handy to make comparisons, as well as household and income information. If this is your first health plan, be aware of your needs and know your tax situation. Eligibility depends on the size of your family and combined income from all sources.

Add a Comment

*0 / 3000 Character Maximum