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“Tax season is ripe with opportunity for scammers to prey on hardworking New Yorkers,” said Attorney General Letitia James. “These bad actors use a wide range of tactics to illegally cheat residents out of their money, including individuals who impersonate the IRS and businesses that bait-and-switch their tax preparation services."
Tax scams come in many different forms, but some of the most common types include:
- Scammers impersonating the U.S. Treasury Department, the IRS, the Taxpayer Advocate Service or other government officials calling taxpayers to try to collect false debts
- Scammers claiming consumers owe prior tax debts and demanding payment using a prepaid credit card or gift card
- Tax prep businesses that advertise low fees and drastically increasing final fees claiming that the return was more complicated than they expected
- Taxpayers who receive a much higher “tax refund” than expected, which must then be returned because it was stolen from another individual
Fortunately, there are several ways to prevent scams by ensuring the authenticity of any government agency that inquires about your tax refund. Attorney General James suggests these tips:
- Never give out personal information, including your Social Security number, bank account information or other payment information to callers over the phone
- Remember that if you owe money, you will receive a legitimate notice in writing that includes agency information and the reason you owe money
- Remember that legitimate government agencies will never ask consumers to pay using pre-paid debit cards, credit cards, gift cards or wire transfer, nor will they threaten arrest or deportation for failure to pay a debt
These tips can also help ensure you’re filing your returns as efficiently as possible:
- Using only established and recognizable tax services
- Checking the tax business’s reputation with the Better Business Bureau
- Avoiding companies that promise cash for preparing return but instead offer a discount on inflated fees
- Ensure the preparer is accessible, even after the April deadline
- Never sign a blank return
- Review the entire return before signing it
- Be sure that the preparer signs the tax form and includes a Preparer Tax Identification Number (PTIN)
- Consult New York’s Consumer Bill of Rights Regarding Tax Preparers
Victims of scams should also report the incident to the Office of the Attorney General by submitting an online complaint, which can be done here.
The Attorney General also reminds New Yorkers of Volunteer Income Tax Assistance (VITA) sites, which can prepare returns free of charge.
"Armed with the tips and resources provided by my office, I urge New Yorkers to remain vigilant as they prepare to file their taxes and encourage them to notify my office if they encounter any tax scams," said Attorney General James.
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