Just when we’ve finally put our feet up after the busy, crazy holidays, duty calls once again. It is officially tax season. Navigating paperwork, records, pay stubs, bills, and confusing legal copy to file taxes before April 18th can be a drag, and if you’re a senior citizen filing taxes this year – age probably hasn’t made the process easier. Regardless of whether or not you’re filing taxes, if you’re a senior, you may have something bigger to worry about.
Senior citizens are at high risk of fraud and scam during tax season. In 2011, MetLife reported that financial exploitation costs seniors $2.9 billion annually. The elderly are easy targets of tax-time crime for these reasons:
- Elders usually have a large fund for retirement, and excellent credit.
- Seniors are generally polite and trusting.
- Older Americans are less likely to report scams.
- Seniors with memory issues make poor witnesses when they report the crime.
- Some seniors don’t have to file taxes if they don’t make an income. If they are unaware of this, they may easily believe a scam artist who says they should.
To help you spot a tax-time thief targeting you or your senior loved one, we have depicted these four scenarios of criminals you may encounter. Recognize them, outsmart them, and report them. Here’s how.
The “IRS Employee”
“Hello, this is Greg calling from the International Revenue Service. May I speak to Mary? Oh, hello Mary. Have you changed your address? What is it again? Thank you. I am mailing you a bill for your Federal Student Tax. We need you to pay it with a money order, check, or wire ASAP. If we don’t receive payment by February, you will have to answer to your local sheriff. Any questions? Great! Thank you Mary. Have a good day now.”
It is true that actual IRS employees have been arrested for identity theft, mail fraud, and unauthorized inspection of tax returns and return information. They are typically caught and punished. When even that is possible, how can you avert being scammed by an “IRS Employee” imposter?
The verified International Revenue Service says its employees will NEVER:
- Call BEFORE mailing you a bill if you owe any taxes
- Demand immediate payment
- Threaten to bring in the authorities to arrest you
- Ask for credit or debit card numbers
- Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe
Although a call like Greg’s may seem legitimate, you or your caregiver should notice the red flags that tell the truth. When you see them, do not provide scammers with any personal information.
Subject: Update your IRS E-File Immediately!
Dear Vulnerable Senior,
Our records show that your IRS E-file is due for update. Please input your name, birth date, Address, Social Security Number, bank account, and attach your W2 form on the page following this link.
Beware of email phishing scams like this. The IRS does not contact you or request your personal financial information through email. Also notice that the sender email address does not come from the IRS.gov website. The link provided is not secure (does not start with “https”) and does not end with “.gov” as government websites always do. Here, a criminal is trying to access your personal information, possibly to file your W2 form behind your back and receive your tax refund.
What do you do if you receive this email?
- Do not respond or click on its links!
- Forward the scam email to the IRS at firstname.lastname@example.org.
The “Family Attorney”
“Hello Mindy? Mindy dear, this is Lisa, the old attorney gal. Well, I am calling because Crawford told me you need help with your taxes. I have the will of your husband saying you’ve inherited some of his assets. I’d like to get that to you as soon as possible. However, there’s a small processing fee we have to pay to release the funds. The IRS is so annoying. Can you help me pay that out of the way?”
It is widely known that the elderly may struggle with taxes at this time of year. Some are new to pension plans and unable to make sense of expected returns, life expectancy projection, and annuity tables. Some may not understand the 1040 tax form itself, or have too poor vision to see it. Others are unknowing elderly widows whose husbands had always handled taxes themselves. It is easy for a scammer to pose as a good Samaritan offering aid with your tax files for an unforseen fee. It is also easy for a scammer to know background information about you prior to calling, which may disguise that they are in fact a stranger.
To handle a seemingly friendly call like this, go through these precautions:
- Ask the caller for specific information they would only know if they were a true family friend.
- Hang up, call the relative they referenced to and ask if they had ever heard of this person.
- Call the IRS at 1-800-829-1040. IRS workers will tell you if your taxes are impacted by any unknown assets.
“Congratulations! You have won the Minneapolis Recognition award for Admirable Senior Service. To reward you for your selflessness, the city of Minneapolis wants to send you a cash gift of $1,000 to donate to your chosen charity. If you would please tell us your bank account information including the bank name, routing number, account number, and PIN number, we will deposit your reward immediately. Reach us at (758)114-2293. Thank you very much on behalf of the City and your appreciative neighbors.”
Automated calls like these can happen at any time in the year, not just during tax season. Still, sweepstakes or lottery scam calls are one among the top 10 financial scams targeting seniors. Typically, automated scam calls come from computers outside the country. Criminals who make these calls are after your personal information, either to steal your identity or access your assets. In this situation, the scammers might access your bank, and mail you a fake check for the prize money, which would later be rejected. Instead, an amount would go missing from your account. Simply do not call these solicitors back.
If you suspect you’ve been the victim of a scam…
Don’t feel embarrassed or ashamed to talk to someone you trust. You are not alone, and people will help you. When you know you have a scam on your hands, higher authority must get involved. Here are ways to get help:
- Contact the IRS’s Identity Protection Specialized Unit at 1-800-908-4490.
- Call the Eldercare Locator for an Adult Protective Service location close to you: 1-800-677-1116.
- File an identity theft complaint with the Federal Trade Commission (FTC).
- File a report with your local police department and keep a copy of the report on file.
- Follow these directions on what forms to fill out for reporting suspected tax fraud activity to the IRS.
“Four Thieves who Target Seniors During Tax Season,” by Michelle Mendoza, Amada Blog Contributor.