The Internal Revenue Service (IRS) issued warnings about a fresh wave of stimulus scams in the summer of 2021, which coincided with the completion of the third tranche of payments made under the American Recovery and Reinvestment Act.
Fraudsters were sending out messages and emails to their targets, informing them that they were entitled to a “stimulus payment” and that all they had to do to collect it was click on a link with a suspicious URL and provide some personal information about themselves.
In actuality, it was nothing out of the ordinary.
Since the CARES Act began disbursing the first wave of payments in 2020, some form of this scam has been taking place on a regular basis. Unfortunately for criminals, the American Rescue Plan Act was the largest spending bill in history, and as the size of the pot increased, so did the number of scammers attempting to swindle every penny out of it.
Once the deadline for filing your tax returns for 2021 approaches, it’s critical to remain watchful as cybercrooks launch a new wave of attacks that combine conventional IRS frauds with new-school stimulus fraud.
The past two years have been a gold mine for con artists.
In the last two years, there has been an unprecedented transfer of wealth from the government to the people — and innumerable scammers have positioned themselves in the middle of the process to siphon off every dollar they can get their hands on for profit.
According to CNBC, by the time the year 2021 came to a close, scammers had taken more than a half-billion dollars — $586 million, to be exact — since the outbreak of the pandemic began. The average victim suffered a loss of $392.
However, while pandemic scams have seen a steady reduction in recent years, the coming tax season has given new life to the criminal forces lying in the web shadows, who have plans to steal your identity, your money, and your benefits, but they begin by gaining your confidence first.
These are the types of scams to be on the lookout for.
Text Message Scams Are Especially Popular These Days.
The Internal Revenue Service (IRS) updated its warnings about the scams that taxpayers are most likely to experience during tax season in early February, and the most common of these scams is the use of text messages.
At the moment, criminals are targeting smartphones with SMS that include the terms COVID-19, “stimulus payments,” or both of these terms. The texts frequently contain a fraudulent link that purports to be an IRS website URL.
Taxpayers are also being taken advantage of by old-fashioned phone scams.
The Internal Revenue Service also urged consumers to be on the watch for inbound calls that appear to be from the IRS but are from a different phone number.
The caller claims to be an IRS agent and leaves an angry or threatening voicemail demanding immediate payment for an unpaid tax bill or an incorrectly obtained stimulus payment, which the caller does not understand. They have even threatened to arrest people in some cases.
Phone scammers have also pretended to be officials from local sheriff’s departments, your state’s Department of Motor Vehicles, or a federal organization in order to gain access to your personal information.
The pandemic was marked by the introduction of email phishing campaigns purporting to be from the Internal Revenue Service or other government entities discussing COVID-19 stimulus payments.
Language and pretext used in these scams differed, but similar characteristics included an urgent tone, an attempt to persuade targets that they owe money or are due money and must act immediately, and a link purporting to be from the IRS or another known institution.
Fraudulent Unemployment Benefit Claimants File Claims on Your Behalf
The increased unemployment benefits that were made available as part of the COVID-19-relief programs from the start of the pandemic proved to be a particularly lucrative target for fraudsters and con artists.
This year, the Internal Revenue Service (IRS) cautioned workers to be on the watch for Form 1099-G records detailing unemployment benefits that they did not apply for or receive.
Unemployment scams are particularly detrimental since jobless benefits are treated as taxable income in the United States. It is possible that identity thieves will apply for and get benefits on your behalf without your knowledge, and you will be responsible for paying taxes on the money they stole.
Scammers are attempting to obtain your Social Security number, which is quite valuable.
Another popular tax-time warning comes from the Federal Trade Commission (FTC) and concerns about the use of fraudulent Social Security numbers.
Fraudsters may employ text messages, emails, phone calls, or a combination of all three to carry out this scam, but the end goal is always the same — to obtain your Social Security number by tricking you into divulging it.
In many circumstances, they will claim that your Social Security number has been used in a crime and that they require it in order to keep you safe, or that they require your Social Security number in order to assist you in receiving stimulus money that you are entitled to receive.