How to Spot Tax Scams so You Can Avoid Them



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Violators of the law use many parts of the government system against itself in order to profit from loopholes, breaches in computer networks, lack of security and many other areas that may be exploited.

No system is truly safe from the possibility of these actions no matter how protected. Scams are part of employment, taxes and insurance that allow offenders of the legal system to garner income that should be allocated to other areas such as governmental agencies or organizations. In most instances, individuals or companies are targeted to ensure benefits are stolen or obtained. It is only by spotting these issues early that they may be avoided more easily.

There are many schemes concocted to rob a person of his or her money, but tax scams usually involve cheating others in one way or another. The individuals that perpetrate these plans are most often very persuasive or charming. The targeted victim is fully unaware there is any dark plot to rob him or her of hard-earned money. With preparation, these persons may avert financial ruin or even the loss of much-needed funds. It is important to know what to look for when a circumstance arises where a new acquaintance enters the life of someone that has been granted or earned a considerable amount of money. However, there are even those criminals that seek to steal what may be considered crumbs in only a few thousand in monetary payouts, benefits or similar gains.

Scamming through Taxes

Successful endeavors of robbing another person are usually accomplished by exploiting an area that most are uneasy about or do not feel the need to suspect. This is in the manner of the potential to owe the government money due to taxes. Because an individual is unwilling to believe there could be any issue with his or her tax return or documentation, he or she may not see the con artist for what he or she is.

Of the most successful scams, emails are only one of the most widely used forms to garner information from a person. These could be legitimate emails with viruses or backdoors, or they could be completely fictitious and only appearing as valid. Schemes to obtain this data often include the use of an email that has the surface appearing of an official department of the United States government. This may include the IRS or another department or have information from both agencies. Usually, these emails explain that money is owed to the owner of the email account. However, the person must provide or verify his or her personal information to ensure payment is received. As most individuals are excited about receiving money from the government, they open the email link to enter the data. Turning over this information provides the con artist exactly what he or she needs to strip a bank account or credit card of all the person’s funds.

Defrauding the Government

Tax scams may use other forms of defrauding organizations or agencies of the United States government. This usually originates from a specific person targeted as the victim. His or her documentation is used in order to steal from government agencies or programs. While this appears to be harmless, the victim does pay for these crimes in one way or another. To be successful, fraudulent information is provided on tax returns that appears to be valid. These areas of falsified data may include inaccurate tax deductions, misleading documentation and inconsistencies in files to ensure fewer taxes are paid. If someone convinced the person filing to complete these actions, he or she is usually gone long before the repercussions occur along with whatever profits he or she gained through the process. This means the person that filed is at fault and takes all the penalties.

Popular Scams

Another popular scam usually involves a person transferring funds to an account or area overseas. A country far from where the money is sent allows a person to avoid tax payouts to the United States government. However, money is needed in order to initiate these actions. This frequently causes a person to pay for something that does not exist. Funds are usually lost in considerable amounts for those that truly need them.

Some foreign persons use another scam to gain assistance from an individual. This involves him or her sending money to this offender which moves out of the United States. Variations include schemes of inheritance, funds from a failed bank, someone else attempting to feel a country or someone trying to enter America. They explain that some of the money used goes to the person that helped them. It is only by spotting these scams that they may be avoided or prevented from occurring.


Provided by HG.org

Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.
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