Watch Out for Gift Card Scams

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There’s never an off-season when it comes to scammers and thieves who want to trick people to scam them out of money, steal their personal information, or talk them into engaging in questionable behavior with their taxes. While scam attempts typically peak during tax season, taxpayers need to remain vigilant all year long. For example, gift card scams are currently on the rise and there are many reports of taxpayers being asked to pay a fake tax bill through the purchase of gift cards.

Here’s a typical scenario:

  • Someone posing as an IRS agent calls the taxpayer and informs them their identity has been stolen.
  • The fake agent says the taxpayer’s identify was used to open fake bank accounts.
  • The caller tells the taxpayer to buy gift cards from various stores and await further instructions.
  • The scammer then contacts the taxpayer again telling them to provide the gift cards’ access numbers.

Scammers are continuously perfecting their tricks and sometimes it is difficult to determine if it is really the IRS calling. Keeping this in mind, taxpayers should be reminded that the IRS will never do the following:

Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes. Demand that taxpayers pay taxes without the opportunity to question or appeal the amount they owe. All taxpayers should be aware of their rights. Threaten to bring in local police, immigration officers or other law-enforcement to have the taxpayer arrested for not paying. Revoke the taxpayer’s driver’s license, business licenses, or immigration status.

People who believe they’ve been targeted by a scammer should contact the Treasury Inspector General for Tax Administration to report a phone scam. Use their IRS Impersonation Scam Reporting web page or call 800-366-4484. Phone scams should also be reported to the Federal Trade Commission. Use the FTC Complaint Assistant on FTC.gov and make sure to add “IRS Telephone Scam” in the notes. Unsolicited email claiming to be from the IRS, or an IRS-related component like the Electronic Federal Tax Payment System, should be reported to the IRS at phishing@irs.gov and be sure to add “IRS Phone Scam” to the subject line.

Any accounting, business or tax advice contained in this article, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties. If desired, we would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services.