Villadom Times Weekly Newpaper Online-August 12, 2009 Issue

August 12, 2009 THE VILLADOM TIMES III • Page 17 IRS warns of scams involving ofﬁcial-looking details The Internal Revenue Service reminds consumers to avoid identity theft scams that use the IRS name, logo or website in an attempt to convince taxpayers the scam is a genuine communication from the IRS. Scammers may use other federal agency names, such as the U.S. Department of the Treasury. In an identity theft scam, a fraudster, often posing as a trusted government, ﬁnancial, or business institution or ofﬁcial, tries to trick a victim into revealing personal and ﬁnancial information, such as credit card numbers and passwords, bank account numbers and passwords, Social Security numbers, and more. Generally, identity thieves use someone’s personal data to steal his or her ﬁnancial accounts; run up charges on the victim’s existing credit cards; apply for new loans, credit cards, services, or beneﬁts in the victim’s name; and even ﬁle fraudulent tax returns. “The scams may take place through email, fax, or phone,” said New Jersey’s IRS spokesperson, Gregg Semanick. “When they take place via e-mail, they are called ‘phishing’ scams. The IRS does not discuss tax account matters with taxpayers by email.” The IRS urges consumers to avoid falling for the following recent schemes: Making Work Pay Refund This phishing e-mail, which claims to come from the IRS, references the president and the Making Work Pay provision of the 2009 economic recovery law. It says there is a refundable credit available to workers, consumers, and retirees that can be paid into the recipient’s bank account if the recipient registers their account information with the IRS. The e-mail contains links to register the account and to claim the tax refund. In reality, most taxpayers receive their Making Work Pay tax credit, which was designed for wage earners, in their paychecks as a result of decreased tax withholding, not as a lump sum distribution from a federal fund. Additionally, consumers and retirees who are not wage earners are not eligible for this tax credit. Inherited Funds, Lottery Winnings, Cash Consignment In this phishing scheme, recipients receive an e-mail claiming to come from the U.S. Department of the Treasury notifying them that they will receive millions of dollars in recovered funds or lottery winnings or cash consignment if they provide certain personal information, including phone numbers, via return e-mail. The e-mail may be just the ﬁrst step in a multi-step scheme, in which the victim is later contacted by telephone or further e-mail and instructed to deposit taxes on the funds or winnings before they can receive any of it. Alternatively, they may be sent a phony check of the funds or winnings and told to deposit it, but pay 10 percent in taxes or fees. Thinking that the check must have cleared the bank and is genuine, some people comply. However, the scammers, not the Treasury Department, will get the taxes or fees. Form W-8BEN In this scam, fraudsters modify a genuine IRS form, the W-8BEN, Certiﬁcate of Foreign Status of Beneﬁcial Owner for United States Tax Withholding, to request detailed personal and ﬁnancial information. This could include nationality, passport number, bank account, and personal identiﬁcation numbers, spouse’s name and mother’s maiden name, or other personal or ﬁnancial information or security measures for ﬁnancial accounts. The scammers may use the genuine form number and name or may make up a new form number, such as W-4100B2. They either e-mail or fax the form or letter. If only a letter, the letter contains the request for the personal and ﬁnancial information. The letter, which claims to come from the IRS, states that the recipient will face additional taxes unless he or she quickly faxes the required information to the number provided by the scammer. In reality, taxpayers ﬁle the genuine Form W-8BEN with their ﬁnancial institutions, not with the IRS. Additionally, the genuine W-8BEN does not request the taxpayer’s passport number, bank account number, security or similar information. Refund Scam The bogus e-mail, which claims to come from the IRS, tells the recipient that he or she is eligible to receive a tax refund for a given amount. It instructs the recipient to click on a link contained in the e-mail to access and complete a form for the tax refund. The form requires the entry of personal and ﬁnancial information. The refund scam is the most common one seen by the IRS. Several recent variations on this scam have claimed to come from the exempt organizations area of the IRS. Some others have included the name and purported signature of a genuine or a made-up IRS executive. Taxpayers do not have to complete a special form to obtain a refund. Taxpayer refunds are based on the tax return they submit to the IRS. How to Spot a Scam Many e-mail scams are fairly sophisticated and hard to detect. However, there are signs to watch for, such as an e-mail that: Requests detailed or an unusual amount of personal and/or ﬁnancial information, such as name, SSN, bank or credit card account numbers or security-related information, such as mother’s maiden name, either in the e-mail itself or on another site to which a link in the e-mail sends the recipient. Dangles bait to get the recipient to respond to the e-mail, such as mentioning a tax refund or offering to pay the recipient to participate in an IRS survey. 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