TAX SEASON IS ALSO TAX-SCAM SEASON FOR CON ARTISTS

Here’s How You Can Outsmart the IRS Imposters.

For businesses of all sizes, tax concerns are a constant part of operations.

Your growth and success are measured by sales and profit…after taxes. Tax issues, paying the right amount and knowing all the tax advantages are every business’s concern.

You know it and unfortunately so do scammers. The tax-filing season begins in late January every year, which means scammers will be out in force for a few months leading up to April 15. Here are just a few of the many types of scams con artists are using during tax season:

Phishing: Posing as the IRS (or fellow employees), scammers send realistic-looking emails to employees or executives and request important employee information or bank account numbers.
Identity Theft: Thieves do whatever they can to gain enough information to steal identities. They may open new credit accounts or make large fraudulent transactions.
Fake IRS Phone Calls: Scammers pretending to be IRS agents make calls demanding immediate tax payment. The caller ID may even read “IRS,” although that is not valid.

It’s very important that businesses take steps to raise the awareness throughout their companies of tax-time fraud and other scams. Banc of California has resources to help you build a culture of cyber readiness on our Business Insights pages.

With the right information about what to look for, your business (and your employees) can avoid being tricked this tax season and throughout the year.

Some stats to open your eyes:

Thousands of businesses and individuals have lost millions of dollars and their personal information to tax scams
Last year, nearly 90,000 people in the U.S. reported a complaint to the Federal Trade Commission (FTC) regarding tax fraud and identity theft
Scammers contact millions of people during tax season at home and work via email, phone calls and text messages

Scammers stay in tune with what’s going on in the country as it relates to taxes, deadlines, credits and refunds, and they use every imaginable plea, pitch or threat to find victims.

We want to help you protect your business assets.

At Banc of California, we’re in the business of helping our clients navigate the challenges of today’s changing business climate and take advantage of opportunities.

We believe it’s vitally important for our clients to know about the IRS and the way it operates year-round, and especially during tax time. It’s important to know this because con artists are hoping that you 1) don’t know much about it and 2) will let your guard down.

Here are the facts about the IRS:

The IRS is an extremely busy organization. Ever since COVID-19 hit and disrupted our lives, the IRS has been extremely busy providing information. From January to May of 2020, they fielded 145 million phone calls, four times more than normal. They’ve done an admirable job.

Why this is important to know. The IRS’s priority is answering questions and processing filings for citizens, online and via mail. They’re truly NOT in the business of asking random employees and business owners for information or texting and emailing documents.

The IRS virtually never calls, texts or emails out of the blue. And they’re not going to reach out to you or any employee that way. The IRS nearly always communicates with taxpaying citizens and businesses via U.S. mail (physical letters) to start.

Why this is important to know. You can confidently ignore any text, email or phone call that seems to come from the IRS. Chances are, you’ll be avoiding a scam when you do.

The IRS tells you when they need to talk to you. You’ll know when the IRS wants your attention. Again, it will start via a letter in the mail, not in your email inbox. If they need to meet or speak with you, they’ll spell it out very clearly in the letter.

Why this is important to know. Anyone reaching out to you with a suddenly urgent email, text or call is surely an imposter and scammer. Do not respond to their messages and do not worry about ignoring them. For more information on business email fraud, read our Business Insights article.

The IRS doesn’t demand immediate payment “or else.” Virtually no legitimate organization uses threats and scare tactics. Who does? Scammers looking for victims!

Why this is important to know. Any demand for payment or account information coming from a caller or emailer is a sure sign of fraud. Even subtle threats are the sign of a scam.

The IRS wants to move you online. The IRS would prefer it if everyone would go to IRS.gov to set up an account and PIN to create a secure connection for filing and paying taxes.

Why this is important to know. The IRS is as concerned about tax scams as you are. Creating a secure connection will reduce fraud and secure your payments and refunds. The IRS still will not email you, so do not respond to any email from “IRS.gov.” Go directly to IRS.gov for information.

Your employees are targets too.

Oftentimes, IRS impersonators will use scare tactics or subtle tricks to get employees to divulge bank account numbers, tax ID numbers and more. Again, scammers are counting on fear or confusion to make their fraud work. However, if your employees learn the truth about how the IRS actually operates, they’re more likely to avoid falling into a tax-time trap. Knowledge is power.

Get everyone on the same page.

We encourage you to forward information about tax-time scams to your employees to raise their awareness of the problem. The more everyone is aware how the Internal Revenue Service works (which scammers don’t want us to know), the better prepared they are to avoid trouble.

For more information on protecting your business from fraud, visit the Banc of California Business Insights page on the Banc of California website. You’ll find valuable information from business experts on a variety of topics, including cybersecurity.

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